No Liberty tender offer for now, says SEC chief

FOR THE minority shareholders of recently acquired  Liberty Telecoms Holdings Inc., a long wait can be expected before they could sell their holdings.

Securities and Exchange Commission (SEC) Chair Teresita Herbosa said the SEC had ruled out any tender offer for Liberty Telecoms until the row between buyers PLDT Inc. and Globe Telecom and the government antitrust body was resolved.

That now includes a decision on a legal case PLDT and Globe filed in the Court of Appeals last month to block the Philippine Competition Commission from reviewing their joint P70-billion acquisition of San Miguel Corp.’s Vega Telecom, which owns Liberty, among other entities.

“The tender offer issue will be considered by the SEC if and when the PCC has already approved the transaction,” Herbosa told the Inquirer.

Whether the PCC had the right to approve the May 30 acquisition of Vega was the main area of its dispute with PLDT and Globe, which insisted the deal should be “deemed approved,” based on the antitrust body’s transitory rules at the time.

PLDT and Globe earlier sought clarification from the SEC on how to proceed with the tender offer, including the price of shares to be bought back from minority stockholders, who control nearly 13 percent of the firm.

PLDT regulatory affairs and polices head Ray Espinosa, recently named co-chair and co-president of Liberty, said last week they were still in discussions with the SEC on the matter.

PLDT and Globe, via Vega, planned to launch a “voluntary” tender offer within this quarter, with the intention of delisting the company from the Philippine Stock Exchange before the end of the year.

Herbosa’s statement should provide some directions to minority investors holding on to their Liberty shares, whose price has been declining since the deal was launched. Liberty shares have gone down by close to half since May 30.

A tender offer is a mechanism designed to protect minority shareholders in an event like a buyout of a company. Specifically, it gives a minority shareholder the option to exit at the same price as the major selling parities.

PLDT and Globe earlier said Vega would launch voluntary tender offer instead of the mandatory offer required by the Securities Regulation Code. They said this case was different since it was the unlisted shares of Vega, and not Liberty directly, that were bought.

The Vega transaction was aimed at unlocking San Miguel’s valuable radio frequencies, including those in the 700 megahertz band. PLDT and Globe said these were needed to improve internet services, whose quality was said to be lagging behind regional peers.