Digitel soon to bid PSE goodbye

MANILA, Philippines – Telecommunications firm Digital Telecommunication Phils. Inc., (Digitel) has asked the local stock exchange to allow it to delist its shares now owned and traded by a few.

In a statement on Wednesday, January 25, Digitel asked the Philippine Stock Exchange (PSE) to delist the remaining 185 million shares, representing a paltry 2.91% of the firm’s common shares, by March 26, 2012.

A delisting will transform Digitel, which pioneered unlimited call and text services, into a privately held firm after almost 15 years as a firm that the public can own minority shares in and trade these at the PSE.

While corporate governance advocates have been pushing that major companies list in the exchange where higher transparency standards rule, Digitel’s delisting comes after telecommunications giant Philippine Long Distance Telephone Corp (PLDT) acquired around 98% of the firm over the past two months.

PLDT acquired the 51.55% controlling stake of the Gokongwei group in November 2011 through a P69 billion equity-debt deal.

Following a tender offer — a required process imposed on buyers to allow minority shareholders to avail of the same price paid by the buyer to the selling shareholders — PLDT acquired additional 45.54%.

PLDT paid additional P4.6 billion through cash and stock to the minority shareholders who tendered their shares.

After all these, Digitel has less than the required 10% public floor imposed by the PSE.

PLDT and Digitel now corners over 70% of the local mobile market. Despite the telecommunication firms assurances that fears on return to a monopolized industry are unfounded, the impact on service and pricing have yet to be felt by their subscribers. – Rappler.com