To prove the legality of its acquisition of rival Sun Cellular, the Philippine Long Distance Telephone Co. (PLDT) will make public a copy of its deal with the Gokongwei family, confident that this will withstand public scrutiny.
In a statement on Thursday, PLDT said it had heeded calls by rival networks and consumer groups that earlier called for more transparency in the deal that would change the dynamics of the country’s competitive telecom sector.
“We are submitting the agreement to the NTC [National Telecommunications Commission] voluntarily to dispel malicious statements made by some parties that PLDT and Digitel Telecommunications Philippines Inc. have something to hide,” PLDT director and head for regulatory and policy affairs Ray C. Espinosa said.
Earlier this month, Ayala-led Globe Telecom Inc. accused PLDT and Digitel of hiding details of their deal that would kill competition in the industry, leading to higher rates for consumers.
Globe said the NTC should order PLDT to publish its share purchase agreement with Gokongwei-led JG Summit Holdings for a majority stake in Digitel, the operator of brand Sun Cellular.
After the deal, PLDT will end up with a 70-percent market share in terms of subscribers and revenues, higher than the company’s current 55-percent share.
Globe, which will be left with a 30-percent share in the market, has called the deal anticompetition, and would lead to an imbalance in the industry. This would result in slower industry innovation and higher costs for consumers.
But Espinosa assured that the deal was proconsumer and would bring about substantial benefits to the general public.
“With this investment, Digitel customers and the public will be assured that Digitel will have the financial resources needed to continue and sustain its popular unlimited services under the Sun Cellular brand,” Espinosa said. “The PLDT Group is committed to support and continue these unlimited services.”
Under the deal, PLDT would acquire 51 percent of Digitel from JG Summit for about P69.1 billion. This price includes convertible corporate bonds and intercompany advances to JG Summit.
PLDT will issue new shares at a price of P2,500 each to be used as payment to JG Summit for the Digitel stake.