Denis O'Brien has stepped up his efforts to court the US media with an interview in Time magazine which suggests that he may raise up to $2.5 billion (€1.95 billion) in a flotation of his rapidly expanding Caribbean telco Digicel to fund its entry into the hugely-competitive US market.
"I've launched a Tet offensive on every possible objection because there's nobody who doesn't deserve a new phone," Mr O'Brien said in an interview that comes some weeks after he spoke with the mass market USA Today newspaper. His remarks to Time appear to be in contrast to comments he made last month to the Sunday Business Post in which he denied that he was preparing for an initial public offering (IPO) in Digicel stock on the New York Stock Exchange.
"Currently, O'Brien owns more than 80 per cent of Digicel, its 2,000 employees hold an 8 per cent stake and the private equity firm Blackstone Group has about 3 per cent. But O'Brien hasn't ruled out an IPO to fund his American adventure, one that's expected to be worth an additional $2.5 billion," said Time.
Digicel is already recruiting staff for its US operation, where Mr O'Brien sees an underserved market in which there are only about 68 phones for every 100 people. The magazine suggests Digicel will target US customers who are young, poor or immigrants, groups that traditional operators tend to avoid. Such a strategy mirrors its moves to dominate the Caribbean market.
"We are going to completely change how Americans view cell phones," he said. Mr O'Brien declined to elaborate on his means of achieving that, saying it was "the kind of thing that if I told you, I'd have to kill you".
Preparations for a flotation are said in private to be under way, although the precise timing remains unclear for the moment. An explanation for the absence of detail may lie in the fact that the price of Digicel's outstanding bonds would change were the company to formally indicate that it was planning an IPO.
Digicel raised $150 million in a bond issue last August.
The issue was priced at a yield of 8.625 per cent, on better terms than a $300 million issue in July 2005, which was priced at 9.25 per cent.
Time said Digicel had three million subscribers, significantly more than previously indicated. Esat Digifone had 700,000 subscribers in 2000 when Mr O'Brien made his fortune by selling the company to BT.
