DITO CME all set for P4.2-B follow-on offer in October

DITO CME Holdings Corp. is set to launch its follow-on offering of up to P4.2 billion worth of shares next month, allowing the country’s third telco to raise funds for expansion plans.

Donald Lim, president and chief operating officer of the listed firm, told reporters at the sidelines of an event held in Taguig City last week that the offer period for the fund-raising activity will start on Oct. 10.

The company previously disclosed its plan to sell up to 10 percent of issued and outstanding capital stocks, or 1.95 billion common shares, for P2.15 each.

Lim said DITO had already secured approvals from the Securities and Exchange Commission and Philippine Stock Exchange.

Further details about the transaction, however, are yet to be disclosed.

“We’re hoping it (follow-on offering) will be oversubscribed. I think it will,” Lim said.

Before this, DITO CME was supposed to complete an P8-billion stock rights offering in 2022, but decided to drop it due to weak demand from large investors. As a result, the company refunded the subscription payments made by the investors.

Lim said no cancellation would happen this time around. “The external conditions are very different,” he said, expressing optimism towards the economy and stock market.

DITO CME also wants to secure up to P40.26 billion in fresh funding via private placements in the next five years or until the end of 2028.

The company led by Davao-based businessman Dennis Uy last year raised P5.5 billion from selling common shares to Singapore-based, third-party investors.

On the debt side, DITO CME also secured last year a 15-year loan agreement from several creditors amounting to $3.9 billion (about P224.48 billion) in total.

Also last year, the company drew down P170.61 billion from these loan facilities to repay obligations and cover network construction-related payables.

DITO CME earmarked P27 billion in capital expenditures for this year in order to reach geographically isolated and disadvantaged areas, where there is a lack of internet connectivity.

As of end-June, it has over 11.3 million subscribers and 7,450 telecommunications towers that serve 80.65 percent of the country’s population.

The telco player passed its fourth technical audit last year—its commitment to the government after securing the franchise to operate in 2019.

The review showed that it had minimum average broadband speeds of 74.97 Mbps (megabits per second) for 4G and 639.32 Mbps for 5G—beyond the minimum 55 Mbps requirement.

DITO Tel also chalked up a population coverage of 80.65 percent, surpassing the 80.01-percent commitment. INQ