PT&T eyes stock market return after two-decade suspension

MANILA , Philippines  -After a two-decade lull, Philippine Telegraph & Telephone Corp. is preparing to return to the stock market after its major shareholders injected fresh capital and wiped out about P12 billion in debt in a rare turnaround event for one of the largest firms struck down in the aftermath of the Asian Financial Crisis.

PT&T, which was established in the early 1960s and was once a rival of industry giant PLDT Inc., is seeking the Philippine Stock Exchange’s approval to lift a 2004 trading suspension, which will allow it to raise money from investors for expansion, company executives said in an interview.

“Last week, we finally extinguished all the debts of PT&T so we are now positive,” said Benjamin Bitanga, the company’s major shareholder.

“We have now asked the PSE to lift the trading suspension, because that was the only remaining condition,” he added.

PT&T provides fixed-line internet and IT service mainly to businesses in Metro Manila and provinces such as Cavite, Laguna, Batangas, Rizal and Quezon.

READ: PT&T seeks to raise up to P17B to enhance network infra

Bitanga said his investment firm, Menlo Capital, which entered PT&T in 2017, provided about P700 million in fresh funding together with the firm’s original shareholders.

They also recently completed a debt to equity restructuring after securing the approval of majority of creditors. This allows the firm to meet the terms of its corporate rehabilitation, Bitanga said.

“With this development, we can go all out and expand our network and grow to a much bigger subscriber base,” he said.

PT&T president and CEO James Velasquez said during the interview they were also in ongoing talks with foreign investors, which will help the company finance a $350-500 million expansion plan.

READ:  SEC OKs PT&T’s 230% capital hike

He said PT&T has tapped a leading global financial adviser for the deal, although he could not name the firm due to a confidentiality agreement.

“At this juncture, the commercial due diligence, technical due diligence, which is done by an independent party, is completed already. We’ve also done legal due diligence. All of that is done and those are requisites to a fundraise of that the size that we’re looking for,” he said.

He said proceeds would support a 10-year expansion plan that will allow PT&T to more than double its market share to about 15 percent in the enterprise segment and enter the home broadband business, which will complete with the incumbent telco giants and Converge ICT Solutions.

“We will definitely need to expand our network, expand our portfolio of offerings, expand our base of operations,” Velasquez said.

“We are working toward expansion in terms of going beyond the enterprise space and getting into residential markets,” he added.

PT&T doubled losses during the first nine months of the year to P57.4 million while revenues slipped 3 percent to P396.4 million. It ended the period with a capital shortfall of P9.6 billion, its latest financial report showed.