No tender price yet for LTHI shares

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EMETERIO SD. PEREZ

EMETERIO SD. PEREZ

SAN Miguel Corp. recently sold its telecommunications assets to Philippine Long Distance Telephone Co. and Globe Telecom Inc.

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In its June 1 posting on the Philippine Stock Exchange website SMC said: “The consideration is P52,080,764,982 inclusive of outstanding advances and the assumption of liabilities of Vega and its subsidiaries amounting to P17,021,535,948.”

Vega is Vega Telecom Inc., a wholly owned SMC subsidiary, which used to hold SMC’s investments in Liberty Telecoms Holdings Inc. (LTHI).

Following is SMC’s capital profile for public investors who are watching how the sale of telecom assets would impact on the financials of San Miguel. SMC posted on May 13 its financial report for the first three months of 2016.

Capital profile
In a definitive information statement (DIS), SMC listed 3.851 billion shares under outstanding capital stock as of March 31, which comprise 2.379 billion common shares and 1.472 billion preferred shares. SMC’s preferred shares are all listed.

Top Frontier Investment Holdings Inc. owns 1.573 billion SMC common shares. They represent 40.85 percent of the outstanding capital stock (3.851 billion shares). Privado Holdings Corp. holds 368.141 million common shares, or 9.56 percent.

Lodged with PCD Nominee Corp. are Filipino-owned 1.394 billion shares, or 33.855 percent, divided into 192.681 million common shares and 1.111 billion Series 2 preferred shares.

Top Frontier has two stockholders; Inigo Zobel and Ramon S. Ang, holding 59.96 percent and 26.03 percent, respectively. Ang is SMC’s president and chief operating officer.

Re-computation
The percentages enumerated under capital profile are based on the company’s 3.851 billion capital stock consisting of common and preferred shares. Since common shares elect the members of the 15-person board, Duediligencer is re-computing the ownership profile based on 2.379 billion common shares.

Thus, Top Frontier’s 1.573 billion common shares equals 66.12 percent; Privado Holdings, 368.141 million common shares, 15.475 percent; PCD-lodged 192.681 million common shares, 8.099 percent.

Ang, according to an explanatory note, is the “beneficial owner of 100 percent of the outstanding capital of Privado Holdings, which, together with Master Year Limited, holds his 26.03 percent ownership in Top Frontier.

Tender to buy
Globe Telecom and PLDT have assured LTHI’s public stockholders that they would buy the remaining Liberty shares held by the public. This is called compulsory tender by the two buyers of Vega Telecom, which, in turn, was the majority stockholder of Liberty Telecom.

Despite this assurance, both Globe and PLDT have not decided yet on the price per share of the LTHI holdings of the public stockholders. The two companies had announced their tender-to-buy plan in separate notices published in newspapers.

Despite these notices, the public stockholders of Liberty Telecoms have yet to be told the tender’s price per share.

Meanwhile, Liberty Telecoms per share market price hit a 30-day high of P5.05 and fell to a month’s low of P2.85. On July 8, the stock opened at P3.16; peaked at P3.22, dropped to a session’s low of P3.16 and closed at P3.17

Previous tenders
To give the public an idea of Vega’s possible tender price, Duediligencer searched among Liberty Telecoms’ filings, still posted on the PSE website, and found the following tenders/buybacks:

On July 8, 2009, Vega Telecom bought from existing stockholders 579,111,669 Liberty Telecoms shares from for P2,041,451,161, or P3.525 per share.

On Oct. 5, 2010, Vega Telecom spent P221,482,398 in buying back 64.589 million shares, or P3.429 per share.

On July 21, 2015, Vega Telecom made a tender for the acquisition of 57,271,369 shares from the public and 426,800,168 from existing stockholders for a total of 484,071,537. It paid P1,064,957,381 or P2.20 per share for the acquisition.

The trading prices are not in any way an inducement for the public to either sell or buy more LTHI shares. Rather, they are intended to guide them in deciding what to do with their remaining holdings while waiting for PLDT and Globe Telecom to decide the price that they intend to offer the public for their LTHI holdings.

esdperez@gmail.com.

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4 Comments

  1. duediligencer on

    I don’t think so. I have yet to hear or read about a court case seeking an increase in the price of a tender to buy the remaining shares held by the public after an acquisition of at least 30 or 35 percent of outstanding common shares. Duediligecer

  2. shouldn’t the price for the tender offer be about the same price that pldt and globe paid for their liberty shares?

    • duediligencer on

      You are correct. The price should be the same as the price PLDT and Globe Telecom paid when they acquired Vega Telecom. The question is how much. Duediligencer

  3. If the remaining balance of public stockholders of around 12% would file a case at the SEC & the Courts will it influence both PLDT & Globe to increase its tender offer price?