Gov’t approves Globe takeover of Bayantel
Globe Telecom Inc., the country’s second-biggest telecommunications provider, won the regulator’s approval to acquire control of Bayan Telecommunications Inc. (Bayantel), ending a two-year process that saw fierce opposition from Philippine Long Distance Telephone Co. (PLDT).
The move is the latest consolidation effort in the industry after PLDT bought Sun Cellular operator Digital Telecommunications Philippines Inc. from the Gokongwei family four years ago.
In a decision dated July 2, The National Telecommunications Commission allowed Globe, owned by Ayala Corp. and Singapore Telecommunications Ltd., to convert its debt holdings in Bayantel that would give it a 54-percent stake.
The NTC added that the takeover “neither poses any prejudice to the public interest and convince nor will make the service fail to operate or function better” and instead, promote competition.
“The debt-to-equity conversion transaction between Globe and Bayan will precisely enable the latter’s continued viability as a service provider, allowing it to exit rehabilitation and enhance its current service offering to the public”, Globe general counsel Froilan Castelo said in a separate statement.
A PLDT spokesperson declined to comment Friday.
Bayantel, owned by the Lopez family, ran into hard times due to the 1997 Asian financial crisis and its mounting debts, at the time valued at about $500 million, prompting its entry into corporate rehabilitation in 2003.
The telco’s situation changed when the Lopez family agreed to sell Bayantel’s debts to Globe, a precursor to Globe’s takeover via a debt conversion to equity scheme under a so-called joint application that was filed in 2013.
