With losses averaging J$3 billion per annum over the past three years, most of it due to a write-off of old mobile infrastructure and building a new network, LIME Jamaica is negotiating with a global services firm to take over management of unspecified aspects of its operation.
It is a cost-saving experiment the company has tried before with its customer contact centre that was outsourced to Trinidad, with unsatisfactory results.
That initiative of Rodney Davis was scuttled by his successor Phil Green in 2007.
But a new man is at the helm, Jamaican Garfield 'Gary' Sinclair, an investment banker whose track record spans Jamaica and the US financial markets, but who is new to the high-intensity, cut-throat telecoms arena.
"LIME Jamaica is focused on growing its business. We have been making significant investments in Jamaica over the past several years with the objective of strengthening our position as the leading innovator in telecoms in the market," said Sinclair in a stock-market filing.
"These investments will count for little if we do not match it with similar investments in improving our processes and customer service. Partnering with world-class players to achieve this objective makes solid business sense and it's one of several options open to us, which we are considering."
Signals from the industry indicate the current talks would be a much more ambitious programme than Davis'. LIME's parent company, Cable and Wireless of the United Kingdom, is said to be keeping a close watch on the talks. LIME refused to say whether the partnership talks predated Sinclair, who inherited a company with a J$7.17-billion deficit when he took up office earlier this month.
Sources, while stressing that the talks were exploratory and unlikely to solidify before Christmas or even January, say as many as 400 jobs could be at risk. A November 8 meeting between LIME Jamaica and the unions is expected to be stormy, as the unions seek assurances that, sources say, LIME might be unable to provide because of market disclosure rules.
LIME Jamaica referred the Financial Gleaner to its original statements, when pressed for more details.
"LIME is unable to comment any further on these exploratory talks," said Regional Vice-president for Corporate Communication, Errol Miller.
"If and when there is something to announce, we will do so in a timely manner."
But the partnership talks are said to be with the North American operation of the company, whose headquarters is in Europe.
The global operation is also said to be a US$28-billion to US$30-billion company by revenue, engaged in mobile and Internet communications and trades both in New York and Europe.
And, the Financial Gleaner understands that the global services company has done big business in the recent past with LIME Jamaica.
The announcement of the talks coincides with the recruitment of Sinclair, who joins Chris Dehring at LIME. Both have a track record of dealmaking.
Dehring is one of three pioneering investment bankers in Jamaica, and the men behind the start up of Dehring, Bunting and Golding.
Dehring eventually exited the firm to take on other projects - he is now chief marketing officer of LIME Caribbean and chairman of LIME Jamaica - while Sinclair later entered DBG as a partner and its president.
Sinclair, Peter Bunting and Mark Golding sold the operation to Scotiabank in 2006.
Mobile Internet TV
LIME is currently focused on expanding its 3G mobile network as the broadband market heats up. Having piloted the technology, the telecom will also launch its mobile Internet TV service by year end.
To grow its subscriber base, which in the mobile arena is about 700,000 or one-third of Digicel Jamaica's two million base, LIME announced last month that it would double its marketing spend - which is currently about J$519 million.
Sinclair says the current negotiations would have progressed to the stage of due diligence this week, but that any real progress was still two months away.
"We have been engaging with employees and our union partners, even ahead of appointing a team to pursue this project. Their views will play an important role in shaping the outcome of this project. Our approach is to be all inclusive, and we are confident it will lead us to the best possible outcome," his market filing said.
"Following a series of discussions with key stakeholders, including colleagues over the past week, a due-diligence exercise will begin this week, involving a wide range of parties. It is expected to last up to two months, after which, decisions on the best way forward can be taken," the notice said.