Telstra Corp., the biggest telecommunications company in Australia, plans to invest about $1 billion in the Philippines for a mobile phone joint venture with San Miguel Corp.
Telstra, which recently confirmed talks with San Miguel, said in a presentation during its Investor Day in Australia the company allocated $1.5 billion for new businesses and mergers and acquisitions, including its planned expansion in the Philippines.
“These include investments in our capital program and start-up investments, such as investment in the Philippines, were we to pursue that opportunity,” Telstra chief financial officer Warwick Bray said.
Telstra currently operates customer service centers in the Philippines that serve its clients globally.
The Australian, a broadsheet published by News Corp. Australia, on Thursday quoted Telstra chief Andy Penn as saying the telco giant would spend up to $1 billion, if the company would pursue its investment in the Philippines with San Miguel.
Penn, in a speech during the Investor Day, said the company’s priority next year was to accelerate its growth agenda. “Asia forms an integral part of our growth strategy,” he said.
The planned joint venture between San Miguel and Telstra would see the local conglomerate holding the majority stake, in compliance with the 1987 Constitution, which limits the foreign ownership of utilities to a maximum of 40 percent.
San Miguel earlier said several companies had expressed interest in teaming up with the conglomerate, which bought out its Qatar partner in Liberty Telecoms Holdings Inc.
Earlier, San Miguel’s unit Vega Telecom Inc. signed definitive agreements to acquire stakes of Qtel West Bay Holdings S.P.C., wi-tribe Asia Ltd. and White Dawn Solution Holdings in Liberty Telecoms for P5.75 billion.
Qtel West Bay owned 23.36 percent of Liberty while White Dawn Solution and wi-tribe had 18.44-percent and 2.86-percent stakes in the company, respectively, as of end-March.
Prior to the transaction, Vega Telecom held 35.73-percent stake in Liberty Telecom, which offers 4G Internet to the consumer and corporate markets through Wi-tribe.
San Miguel also announced that Vega Telecoms bought Express Telecommunications Inc. and Vega’s investment in High Frequency Telecommunications Inc. Extelcom, owned by the Ongpin Group and UK-based Ashmore Investment Management Ltd., is the country’s first mobile telephone operator.
San Miguel will now have four telecommunications companies under its portfolio, including Eastern Telecommunications Philippines Inc., Bell Telecommunications Philippines Inc. and Liberty Telecoms Holdings Inc.
Liberty Telecoms, which recently exited corporate rehabilitation, said it expected to break even a year ahead of schedule.
It also aims to launch mobile phone services as early as January next year.