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MANILA, Philippines – Philippine Long Distance Telephone Company (PLDT) will likely take newly acquired Digital Telecommunications Philippines Inc. private after completing the country’s biggest corporate deal.
PLDT chairman Manuel Pangilinan told reporters on Nov. 3 that Digitel will be delisted from the Philippine Stock Exchange when the mandatory tender offer exercise is finalized.
“It’s likely we would move towards delisting of Digitel. It is better that the main listed company would be PLDT,” said Pangilinan.
The government recently approved the merger between PLDT and the Gokongwei-led Digitel after months of delay. The share swap deal between PLDT and Gokongwei was valued at P69 billion, but the buyer has to offer the same arrangement to Digitel’s minority shareholder, pushing the deal price to as high as P74 billion.
PLDT has initially acquired the Gokongwei group’s 51.65% in Digitel, triggering the tender offer rule on transactions involving listed firms that require buyers to offer the same price to the rest of the shareholders.
Digitel minority shareholders can opt to be paid in cash at P1.6033 per share or swap Digitel shares for PLDT shares at a ratio of 1,599.28 Digitel shares for every one PLDT share.
PLDT treasurer Anabelle Chua said the tender offer will take place this November. “It will be sometime this November. We are still working through the preparation of documents. The rule is for 20 working days so it’s a month effectively.”
“We will hold the tender offer first before we can delist. We will do the delisting maybe early next year,” she added.
PLDT currently has 47.7 million subscribers, while Digitel has about 16 million. The deal has created a behemoth that now corners 66% to 70% of the total subscriber base in the country.
Pangilinan maintained that the impact of the PLDT-Digitel transaction would be “very modest”.
“We are quite keen to put the two companies together. We are meeting internally with Digitel management and there will be a series of continued meetings with them to synchronize and better understand the business. Moving forward for 2011, we have to include both capex (capital expenditure) of Digitel and consolidate debts as well,” explained Pangilinan. – Move.PH