Dito welcomes 3rd investor in just a month
MANILA -In just barely a month, Dito CME Holdings Corp. sold another block of shares to an outside investor as it seeks to fund the crucial network rollout of its telco challenger, Dito Telecommunity (Dito Tel).
In a statement on Thursday, the company said Summit Global Ltd., an entity organized and existing under the laws of Cayman Islands, bought for P2.24 billion an 18.5-percent stake in a subsidiary running its telecommunication business.
Summit bought 2.24 billion shares in Dito Holdings Corp. for P1 each, a 54-percent discount of the company’s Thursday closing of P2.20.
The issuance of new shares decreased Dito CME’s ownership in Dito Holdings to 72.91 percent from 89.46 percent.
Dito Holdings owns 60 percent of Dito Tel, the country’s third telecommunications provider that came in during the Duterte administration to break the duopoly of PLDT and Globe. The remaining stake is held by China Telecommunications Corp.
Dito CME, led by Davao businessman Dennis A. Uy, a prominent campaign donor of former President Rodrigo Duterte, has been selling shares in recent weeks after successfully renewing a $1.17-B loan facility with Chinese banks.
In August, the parent company disclosed that Singaporean funds Summit Telco Corp. Pte. Ltd. and Xterra Ventures Pte. Ltd. bought 1.59 billion common shares and 610 million common shares, respectively, in Dito CME also for P1 apiece.
The listed company said the capital injection would be allocated to Dito Tel, which has been on an expansion mode to grow its subscriber base.
Acquire necessary capital
“As a late entrant to the telecom industry, it is important that they acquire the capital necessary to ramp up their infrastructure to meet and grow their business,” Regina Capital Development Corp. head of sales Luis Limlingan told the Inquirer.
The transaction, however, did not excite the market as Dito CME’s share price failed to move, Philstocks Financial Inc. senior research analyst Japhet Louis Tantiangco noted.
“Investors, taking a cautious stance, may want to see first how the additional capital will be used,” he said.
Apart from equity funding, Dito CME president Eric Alberto earlier told reporters the company was eyeing to close a $3.9-billion project finance loan facility this year.
He stressed the need to build up a war chest since the telco industry is capital-intensive.
Dito Tel is likewise eyeing to release a product offering catering to enterprise clients this year. The target market is the micro, small and medium enterprise segment, which Dito Tel chief commercial officer Evelyn Jimenez described as an “underserved” and “unserved” market.