Liberty to issue shares to reduce obligations

Liberty Telecoms Holdings Inc., the telco venture between San Miguel Corp. and Qatar Telecom, is issuing voting preferred shares to its major stockholders to reduce obligations, according to a stock exchange disclosure filed yesterday.

Liberty specifically noted that its board approved the issuance of 431.2 million “unissued shares of unlisted preferred shares” to SMC’s Vega Telecom’s Inc., 287.32 million shares to Qtel West Bay Holdings S.P.C. and 161.48 million shares to White Dawn Solution Holdings Inc. The issue price has been set at P1 a share.

Liberty said the preferred shares are voting, participating, nonredeemable and will have preference over common shares in case the company goes out of business.

The move comes as Liberty increased its deficit to P9.72 billion as of the end of September, its third quarter financial filing showed.

Liberty provides post-paid and pre-paid broadband services but, partly due to intense competition and declining subscriber count, service revenues during the nine-month period went down 44 percent to P197.3 million, the company reported.

Liberty said net loss narrowed to P813.57 million against the P881.95 million of the same period last year.