THE Philippine Long Distance Telephone Co. (PLDT) has asked the National Telecommunications Commission (NTC) to re-study its decision allowing the takeover by Globe Telecom Inc. of Bayan Telecommunications Inc. (Bayantel) via a debt-to-equity transaction.
“With all due respect, this honorable commission erred in applying the PLDT-Digitel case. Even assuming arguendo [Latin legal term meaning for the sake of argument] that the PLDT-Digitel case is applicable, then this honorable commission should, at the very least, apply the same in toto [Latin for totally or completely] and similarly require Globe to divest of its excess frequencies,” PLDT said in its motion for reconsideration filed with the NTC.
In its motion, PLDT said: “In its Assailed Decision, this Honorable Commission relied and extensively quoted its findings in the PLDT-Digitel case as basis for its approval of the Joint Application. With due respect, this Honorable Commission’s ruling is erroneous as the PLDT-Digitel case is inapplicable and not an all fours with the present case.”
The phrase “on all fours” is a reference to a lawsuit in which all the legal issues are identical.
PLDT added: “Even assuming arguendo that the said case is applicable, the Assailed Decision does not, at all, discuss the requirement made in the PLDT-Digitel Case for the divestment of excess frequencies. This piecemeal application of the PLDT-Digitel Case is to the prejudice of other more qualified telecommunications entities which were not given the opportunity to bid for Bayantel’s unused frequencies, and ultimately, the subscribing public.”
Additionally, the telecom giant said: “[W]hat differentiates the starting point or reference in resolving the instant case from the Commission’s Decision in PLDT’s and Digitel’s, the PLDT-Digitel application in NTC Case No. 2011-072 is the backdrop of the instant case—Bayantel’s corporate rehabilitation,” PLDT explained in its filing.
Last month, the NTC approved Globe’s acquisition of a controlling stake in Bayantel under a debt-to-equity transaction.
“With ample safeguard adopted by the commission to still foster and ensure a level playing field, including the conditions attached to the approval of the frequency sharing arrangement between Bayantel and Globe, the commission finds that the acquisition by Globe of a controlling interest in Bayantel, pursuant to the court-approved Amended Rehabilitation Plan and Master Restructuring Agreement, neither poses any prejudice to the public interest and convenience nor will make the service fail to operate or function better,” the NTC said earlier.
Rival PLDT has opposed the joint application of Globe and Bayantel on grounds that the competition would gain significantly more frequencies per subscriber than the PLDT Group.
Globe, however, argued that the points raised by PLDT were not the bone of contention.
Furthermore, Globe has increased its equity interest in Bayantel to nearly 100 percent after buying all of the shares held by Bayan Telecommunications Holdings Corp. (BTHC) and Lopez Holdings Corp. (LHC) for about P1.83 billion.
In a disclosure to the Philippine Stock Exchange (PSE) on July 20, Globe said: “The Transaction follows the conversion by Globe of Bayantel debt into equity provided under the resolution of Bayantel’s Rehabilitation Court (Regional Trial Court Branch 158 Pasig City) in SEC Case 03-25 dated August 27, 2013, and approved by the National Telecommunications Commission on July 2, 2015, as previously disclosed.”
The transaction involved up to 70.76 million Bayantel shares and increased Globe’s equity interest in Bayantel from 56.87 percent to 98.57 percent of outstanding capital stock.