The country’s two largest telecommunications companies on Wednesday asked the government’s newly created anti-trust body to open channels for dialog to resolve the impasse over the joint acquisition of San Miguel Corp.’s telecom assets after their share prices fell.
Globe Telecom Inc. and PLDT Inc., in a letter dated June 14, requested the Philippine Competition Commission for a meeting to address certain issues the agency might have regarding the P70-billion transaction.
“Consistent with our earlier declaration, we express our willingness to cooperate with the honorable commission to settle the issues surrounding the transaction having in mind the tremendous benefit that the public will gain from the immediate unlocking of the advantages of the underutilized frequencies underpinning the transaction,” Globe and PLDT said in a joint letter.
Globe general counsel Froilan Castelo said the impasse had created an atmosphere of uncertainty hanging over the industry, which in turn, caused investors to take a cautious position.
“We are willing to cooperate and work with PCC for the approval of the transaction,” Castelo said.
Investors initially cheered the buyout, with Globe’s share rising to P2,310 at the end of trading day on May 30, when the deal was announced, from P2,188 from the previous trading session.
After PCC’s announcement to review the deal, Globe share prices slid to P2,280 at the end of trading day on June 20.
PLDT’s share price also went up to P1,901 on May 30 from the previous trading session of P1,742. As of June 21, PLDT’s share price stood at P2,120.
PCC earlier said it would pursue a comprehensive review of the P70-billion transaction and “shall approve or disapprove the subject transaction after the conduct of such full review.”
“A comprehensive review includes a determination of the relevant market, whether there will be substantial changes to the market structure, and the potential impact of the transaction on public welfare,” PCC said, adding that the review was intended to ensure that the transaction would not restrict competition.
Castelo said that in acquiring San Miguel’s telco assets, there was no market share gain or loss for any of the parties involved because majority of the companies that belonged to SMC were not operating.
He also said that the return of a complete set of 2G, 3G, 4G and potential 5G, including 20 megahertz of the 700 Mhz spectrum to the government fully supported open market competition, enabling the entry of another industry player in future.
“Amid the clamor for faster and better mobile internet in the country, Globe has remained committed in expanding our capabilities through investments in our network. Considering the challenges in building a superior telecommunications network across the archipelago, particularly in terms of site acquisitions, co-use of the 700 MHz spectrum among existing players will fast track the improvement of mobile internet services in the country through additional capacity and greater coverage,” Castelo said.
Globe earlier said the company was looking to use the 700 Mhz in more sites throughout the country, emphasizing that this particular spectrum was one of the most efficient bands in the deployment of LTE technology.
Globe plans to fire up initial an batch of 200 cell sites in the next few months.
Smart Communications of PLDT also ramped up efforts to expand the coverage and capacity of its network to improve overall subscriber experience nationwide, particularly for mobile data.