San Miguel Corp. has signed a deal to acquire the Ongpin group’s remaining interest in the telecommunications sector in line with the diversifying conglomerate’s plan to grow its telecom business and challenge bigger players.
In a disclosure Thursday, SMC said subsidiary San Miguel Equity Securities signed on October 20 a share purchase agreement for the 37.7-percent stake in Eastern Telecommunications Philippines Inc. (ETPI) held by ISM Communications, a company controlled by the group of former Trade Minister Roberto Ongpin.
The block of shares was valued at P1.507 billion, or P3.39 per share.
The deal will raise SMC’s stake in ETPI from 40 percent, which the company acquired earlier for P1.6 billion, to about 78 percent. This means SMC will be paying more for this latest purchase.
In July, SMC officials said the 37.7-percent stake in Eastern Telecommunications would have cost P1.2 billion, if based on the share price of the conglomerate’s initial purchase.
SMC’s original 40-percent stake in ETPI is held by subsidiary Vega Telecom.
ETPI will become the third telco under the control of SMC after Liberty Telecommunications Holdings Inc. and Bell Telecommunications Inc.
SMC is bent on becoming a major player in the country’s telecommunications sector.
The Ongpin group, backed by London-based investment fund Ashmore, used ISM Communications to acquire the stakes of the Chung, Luy and Nubla families in Philippine Bank of Commerce, which was earlier placed under receivership by state-run Philippine Deposit Insurance Corp.
Incidentally, the Ongpin group is also part of the bloc that holds the controlling stake in SMC. His group also has interests in real estate development (Alphaland Corp.), mining (Atok Big Wedge Co. Inc.), information technology and gaming (Philweb Corp.) and oil refinery (Petron Corp.).
Aside from food and beverage, SMC has interests in power generation, distribution and infrastructure development.