Nextnation To Expand Into Indonesia Market

KUALA LUMPUR, Feb 8 (Bernama) -- Nextnation Communication Bhd, a leading mobile platform developer, has entered into an outsourcing agreement with PT Inovisi Infracom Tbk, a company listed on the Indonesia Stock Exchange, to provide mobile platform infrastructure services. Under the agreement, Inovisi will provide Nextnation a minimum revenue guarantee of not less than US$22.5 million over an initial period of three years from operational commencement, with an option to extend another three years subject to overall performance review by Inovisi, Nextnation said in a statement. The projected minimum revenues to be outsourced to Nextnation are US$3.5 million, US$7.0 million and US$12.0 million for the first, second and third years respectively from the operational commencement date. Under the terms of the agreement, Inovisi will outsource its InoConnect Internet Protocol (IP) Interconnection and InoConnect Bandwidth Optimiser services to Nextnation. Key products and services to be outsourced by Inovisi are an IP interconnection platform to serve telecom operators offering IP services, and an IP bandwidth optimiser which is able to reduce large data packets into smaller packets and allowing data to be sent out via faster and more consistent IP networks. Nextnation's initial investment commitment for this project is estimated at US$5 million, to be financed by a combination of internally generated and/or external funds, which could comprise a combination of cash reserves, bank borrowings or equity financing. The funds will be used to purchase the necessary equipment and to set up the IT infrastructure to fulfil the project's requirements. From this project, Nextnation targets to achieve a cumulative profit contribution of about US$7 million over the initial period of three years. Both parties will also explore the possibility of any proposed future equity and management participation between them, either into a joint venture company to be formed or into an existing company to be used as a special purpose vehicle for the project, or for Inovisi to take up an equity stake in Nextnation. -- BERNAMA