The Securities and Exchange Commission has approved the restructuring of Liberty Telecoms Holdings Inc.’s capital, a stock exchange filing Monday showed.
The restructuring is hoped to wipe out most of the deficit of conglomerate San Miguel Corp.’s telecommunications unit.
Liberty subsidiary wi-tribe Telecoms Inc. had a deficit of about P7.8 billion as of the end of October against its additional paid-in capital of P7.6 billion. “The approval was subject to the condition that if the accumulated deficit as of Dec. 31, 2013 will decrease, the same resulting decrease shall be reverted to additional paid-in capital,” the filing showed.
The move comes as the company continues to battle it out in the highly competitive industry. Liberty managed to narrow losses during the nine months through Sept. to P881.95 million from P1.09 billion in the same period last year. It said subscriber acquisitions for postpaid and prepaid Wimax broadband services grew, translating to about P351 million in revenue.
As a result of operations during the period, Liberty said its deficit increased to P8.36 billion as of September.
“Its major shareholders, however, remain fully committed to support the group’s operations, as clearly shown by the level of financial and operational support already provided thereto,” Liberty Telecoms said in the filing.
Liberty Telecoms in July renewed a corporate loan amounting to P1.1 billion, which was contracted by wi-tribe Telecoms for the expansion of its 4G high-speed Internet network.
The company launched its wi-tribe 4G service in February 2010.
San Miguel president Ramon Ang said in a previous interview the company was prepared to invest more in Liberty to pay its debts.