Unwired Australia, a wireless broadband carrier, and Intel Corporation announced today that Intel Capital has agreed to invest in secured convertible notes issued by Unwired with a face value of AUD$37 million (approximately US$27.9 million at present exchange rates). The investment is part of the companies' efforts to advance the deployment of WiMAX networks.
Unwired will use the proceeds primarily to expand its services to other major Australian cities.
As part of the announcement, the companies have agreed to jointly promote mobile wireless broadband capabilities using WiMAX networks in Australia. Unwired plans to adopt future Intel products that support the upcoming IEEE 802.16e standard for WiMAX solutions intended to be deployed in infrastructure equipment and notebooks.
"Continued investment in WiMAX technology is strategically important for the industry," said Arvind Sodhani, Intel Capital president. "It will enable the provisioning of fast, full-fledged broadband Internet access to a vast proportion of the population in an accelerated time frame."
"Twelve months ago wireless broadband was on the horizon, but today it's an accepted and trusted option for thousands of customers as evidenced by the rapid growth of customers for our Sydney business," said Unwired CEO David Spence. "Intel Capital's investment will enable us to make wireless broadband available to a greater number of Australians and to quickly move to WiMAX in other cities as equipment becomes available."
WiMAX, which stands for Worldwide Interoperability for Microwave Access, is a standards-based wireless technology that provides high-speed broadband connectivity over long distances to homes, businesses and mobile wireless networks. The upcoming IEEE 802.16e version will offer increased broadband Internet access mobility.
"The introduction of the upcoming version of WiMAX will help mobile wireless broadband become absolutely mainstream in the marketplace," Spence said. "Unwired will be in the unique position of having access to the majority of the WiMAX-designated 3.5 GHz and 2.3 GHz licensed bands in Australia's major metropolitan areas."
Unwired will initially deploy technology from U.S.-based broadband wireless access solutions provider, Navini Networks, for its WiMAX networks. Dual-mode customer modems and base stations, which can operate Unwired's current proprietary technology and WiMAX-based technology concurrently, will be available in the first half of 2006.
"The upcoming WiMAX network Unwired plans to deploy will demonstrate how a service provider can deploy this standards-based technology across multiple metropolitan areas potentially covering thousands of square kilometres and serving millions of people," said Varun Kapur, managing director of Intel Capital, Asia-Pacific Region. "It's a model that other leading service providers around the world could and should replicate."
Unwired's shareholders will hold a meeting in October to obtain shareholder approvals for the investment. Details will be sent to shareholders shortly in the Notice of Meeting and Explanatory Memorandum which will be accompanied by an independent expert's report from KPMG Corporate Finance (Aust) Pty Ltd.
The convertible notes would be issued in 45 days -- subject to approval by Unwired's shareholders, fulfillment of regulatory requirements and completion of standard conditions to closing -- and would mature in August 2009.