Converge ICT Solutions Inc. said Friday it signed a P3-billion loan with the state-run Land Bank of the Philippines to fund the completion of its terrestrial and subsea domestic fiber backbone network and support the working capital requirements of the internet service provider.
“This loan financing brings us one step closer to our goal of connecting the unserved and underserved areas in the country. The available funds will help us reach into untapped markets, and really ‘Go Deep’ into existing ones,” Converge chief executive Dennis Anthony Uy said in a statement.
“Our network investments are at the core of our service to Filipinos. There is still huge pent-up demand for high-speed broadband connectivity in the country. And the need for quality internet services became even more critical when the pandemic happened. Suddenly, the home became the office, the school, entertainment center, and marketplace in one,” he said.
The loan package from LandBank will include an additional short term loan line and a facility for its trade transactions amounting to P2 billion.
“This loan package will provide Converge with financial flexibility as we continue to connect Filipino households to our pure fiber network nationwide,” Converge president Maria Grace Uy said.
“We expect this financing facility to strengthen our balance sheet and help us reach our goal of covering 55 percent of Filipino households by 2025.” she said.
Converge programmed P20 billion for 2021 capital expenditures, with the bulk going into its nationwide expansion where it connected Visayas and Mindanao to its national fiber backbone. It recently commercially rolled out services in Cebu province and did a soft launch in Davao City.
“As you further expand your domestic network, broaden your distribution reach, and secure additional access to international connectivity, we in LandBank affirm our commitment to support you in meeting these objectives,” LandBank president and chief executive Cecilia Borromeo said.
“In terms of inclusivity, Converge’s ‘Go Deep’ strategy to penetrate unserved and underserved areas is aligned with our own, as LANDBANK promotes financial inclusion by serving unbanked and underserved Filipinos,” she said.
The pure fiber network of Converge has passed over 8.3 million homes as of end-June, more than double the figure from a year ago. This accounted for 32 percent of total Philippine households and 57 percent of total homes in Luzon.