Hondutel

Hondutel (Empresa Hondureña de Telecomunicaciones), is the Honduras government's telecommunications company. It has a monopoly on international calls.

The organization was created on May 7, 1976, as an autonomous organization responsible for the moderization of Honduras' telecommunication system, and to achieve a better efficiency in its administration and profitability. Hondutel was historically administered by Honduras' armed forces as telecommunications were considered a matter of national security.

Towards the end of the 20th century, the Honduran government is pressed by the IMF to privatize Hondutel in order to benefit from debt-restructuring solutions and international financial aids. A 1995 law (Framework Law of the Telecommunications Sector) authorized 51% of the company to be sold and privately held. The push towards privatisation was also made by Jaime Rosenthal in 1992, who saw three benefits in this process : bring foreign currency in the country (mainly US dollars), to ensure transparency and accountability, and to boost innovation.

However, a 1995 audit by Price Waterhouse revealed that the company was a high-risk investment thus jeopardizing its privatisation. By 1999, a mere 4.2 lines per 100 inhabitants is accounted.

In 1998, the government is ready to proceed to the privatisation of the company, but the country is badly hit by hurricane Mitch and reviewed its priorities. Finally, by February 2000, seven companies have pre-qualified to capitalize Hondutel (including Telmex, Telefonica and France Telecom). On October 2000, the bid is launched, but only Telmex remained in the race, with a $106 million offer, which was only a third of the government's expectations. The bid was refused. In 2003, the government approved the sale of Hondutel's B band network, acquired by Megatel. In 2004, it is bought back by América Móvil, owner of Telmex.

In June 2007, Hondutel launched its first of a series of Personal Communications Services (PCS) networks. It competes with companies such as Luxembourg's Millicom and Mexico's juggernaut América Móvil. In October, it extended to the Sula Valley, including the cities of San Pedro Sula, La Lima, Villanueva and surrounding communities. In December it extended coverage to La Ceiba.

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Wikipedia