Tender offer for Liberty shares under review

Shares of Liberty Telecoms Holdings Inc. Wednesday surged after Philippine Long Distance Telephone Co. and Globe Telecom signaled that a tender offer to Liberty’s minority shareholders—the subject of heavy speculation and uncertainly in the past week—was now being studied.

Liberty is the only listed firm among those owned by Vega Telecom, San Miguel’s telecom unit that was sold to PLDT and Globe on May 30.

Liberty’s shares Wednesday jumped by as much as 22 percent, before paring gains to about 16.4 percent to close at P3.55 per share. The company was still down by about 21 percent from its price a day before the P70-billion sale of Vega to PLDT and Globe was announced.

The tender offer rule is a mechanism designed to protect minority shareholders. It gives them the option to exit at the same price as the selling price to the new major shareholders.

Both PLDT’s and Globe’s disclosures were carefully worded as they pointed out what was acquired was Vega Telecom and not Liberty directly. In fact, PLDT noted in its filing that it was studying a “voluntary” tender offer to Liberty’s minority.

The Securities and Exchange Commission was clear on the parameters under which a tender offer should be required.

Section 19 of the 2015 Securities Regulation Code implementing rules stated that a mandatory tender offer would be triggered when a person or group acting alone or together ends up owning more than 50 percent of the total outstanding equity of a publicly traded company. That also includes shares of an associate or related company “which controls the said public company.”

SEC spokesman Arman Pan said the SEC’s Securities Registration Division was reviewing whether a mandatory tender offer was required.