SMC says to invest heavily in Liberty Telecoms
abs-cbnNEWS.com | 03/05/2009 9:32 PM
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San Miguel Corp. (SMC) is determined to invest heavily in Liberty Telecoms Holdings Inc. to revive the telecoms business, which shut down operations more than three years ago.
It is not clear yet how much SMC intends to shell out for the acquisition of Liberty and its operations per se. But SMC president Ramon Ang emphasized they are looking to invest more than what their partner, Qatar Telecom (Qtel), is investing in the unit.
Qtel, which is Qatar's dominant telephone service provider, plans an initial investment of $500 million in Liberty. This could go up to $1.5 billion a year after, Ang said.
"At the moment we are checking on how much capital we really need for this telco high investment. So, we are not yet sure on the exact amount," Ang, who sits as chairman of Liberty, said. When asked if SMC will match QTel's reported initial investment, he said, "Maybe even more."
SMC's entry into Liberty has not yet been finalized. At the moment, Liberty is already 27.12 percent owned by QTel, which acquired the stake through subsidiary wi-Tribe Asia Ltd.
In December last year, SMC and Qtel signed a memorandum of understanding to venture into cellular and wireless broadband businesses. The plan is for SMC to acquire 60 percent of Liberty.
"The moment the parties officially have agreed on whatever is needed or the potential offer is needed, our foreign partner QTel and SMC will do whatever is necessary," said Ang.
Incidentally, Ang also mentioned that QTel will also be involved in SMC's plan to acquire Express Telecommunications Inc., the country's first licensed mobile phone firm which, like Liberty, is also under rehabilitation.
"Whatever we will be doing in the telecommunications business, QTel will also be our partner," said Ang.
He said they are in talks with various equipment suppliers to support a plan to provide broadband Internet access through the power lines of the Manila Electric Co. (Meralco), a Lopez-controlled firm, in which SMC also has interest.
"We are in talks with equipment technical suppliers. We do not know yet the technical requirements on how to operate this so we have to wait," he said.
On other telco-related investments, the Liberty chair said it is not closing its doors in acquiring more phone firms for as long as the prospective investments are viable to SMC. "We will take a look at all telecommunications companies that can add value," Ang said. Sources said that aside from Liberty and Express Telecom, SMC is also interested in acquiring another broadband player, eTelco.
Ang also said that the government, if it is interested, can "ride on" to the telecommunications facilities that SMC and its telco partners will own and operate in the future. "Whatever we will do, government can use our facilities," Ang said.
In a special meeting yesterday, the board of Liberty had agreed to increase the company's authorized capital stock by P4.8 billion, all of which are preferred shares valued at P1 each, to P6.8 billion, which will be divided into 1.45 billion common shares and 5.35 billion voting, participating and preferred shares valued at P1 per share.
During the meeting, the board also decided to keep the position of president vacant in the meantime.
Newly-appointed Liberty chief operating officer Anastacio Martirez said the company will be hiring people with telco experience but was quick to point out that Liberty won't be poaching from other phone firms. "As to who, we will have to resolve that soon," he added.
Liberty aspires to be a major player in the wireless broadband sector. Martirez said the company is now in talks with vendors with expertise in telecommunications network for a plan to go into WiMax technology, which, according to the company's rehab plan, is expected to account for more than 90 percent of Liberty's total project revenues.
"We are looking at what best approach to take. We will certainly like to obtain as much synergies that we have," said Martirez.
Martirez formally joined Liberty last February 4 after having held key positions at Smart Communications Inc. and Jakarta-based PT Smart Telecom.
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