Shareholders seek Duterte help on Liberty tender offer

Minority stockholders of Liberty Telecoms Holdings Inc. want President Duterte to step into an ongoing row with the company’s new owners whose buyout price for their shares was deemed too low.

A letter dated Aug. 25 and signed by 10 of Liberty’s minority stockholders was addressed to President Duterte, seeking his help “in our quest for a fair valuation of our stocks.”

The Securities and Exchange Commission’s Market and Securities Regulation Department and Francisco Ed Lim, president of the Shareholders’ Association of the Philippines, were also given copies of the letter.

The current tender offer for shares held by the minority was launched by Vega Telecom Inc., now controlled by PLDT and Globe, on Aug. 24. It will end on Sept. 21 this year.

Both telco giants came to control Vega, the owner of Liberty Telecoms, after acquiring the telco holding company of San Miguel Corp. and two related telco assets for P70 billion on May 30. After the tender offer, Liberty would be delisted from the Philippine Stock Exchange.

The controversy stemmed from the P2.20-a-share tender offer price that Liberty’s minority deemed too low.

Liberty, which has lost more than a quarter of its value since the “lowball” tender offer price was announced last week, should be valued at closer to P5 a share, according to brokerage house Papa Securities, which has taken the lead in criticizing the tender offer price.

Liberty’s minority is contesting how the company was valued since a fairness opinion and valuation report did not take into account Liberty’s valuable 700 megahertz radio frequencies.

They said 80 percent of the total 700Mhz spectrum, potentially worth billions of pesos, was licensed to Liberty.

The valuation report prepared by Punogbayan and Araullo did not consider any frequency assets because these were reassigned from Liberty to another Vega subsidiary, Bell Telecommunications, in March 2015, according to Liberty’s new owners. Liberty disclosed the reassignment more than a year later, in Aug. 2016.