PLDT to issue P100-M stocks

Philippine Long Distance Telephone Co. (PLTD) plans to issue and sell to subscribers P100-million worth of convertible preferred stock series "DD."

The shares, dubbed as 10 percent cumulative convertible preferred stock series DD, will be sold at P10 per share or a total of P100 million and will come from the unissued shares of the company’s authorized capital stock.

These will be sold from Jan. 1, 2003 to Dec. 31, 2003 under PLDT’s subscriber investment plan (SIP) which was established to implement Presidential Decree 217.

The SIP started in 1974 and since then the board of directors of the company has annually created a new series of 10 percent cumulative convertible preferred stock for issuance to the company’s telephone subscribers.

Such shares uniformly earn cumulative dividends at the annual rate of 10 percent. They are convertible into shares of common stock one year from the issue date at a price equivalent to 10 percent below the average market price of the company’s shares of common stock at the Philippine Stock Exchange, over a period of 30 consecutive trading days before the conversion date.

The conversion price, however, should not be less than the conversion price set by the board of directors. At the option of the company, such shares are redeemable at par value plus accrued dividends, five years after the year of issuance.

PLDT has asked the SEC to exempt the share issuance from the agency’s registration requirements.

The telecommunications giant said all the issuances of shares under the SIP starting from Series A to AA were exempted from the registration requirements under the Revised Securities Act. Such shares have also been listed on the PSE.

Under Section 2 of the Securities Regulation Code, the SEC can exempt transactions if it finds that the requirements of registration is not necessary by reasons of the small amount involved or the limited character of the public offering.

PLDT said the size of the shares to be issued are relatively small and the issue price of such shares is fixed at par value.

The company has a pending application with the SEC for the issuance of P2 billion one-year peso notes to fund its working capital requirements.

pldt, the leading fixed line provider in the Philippines with approximately 68 percent of the total fixed lines in service nationwide as of Sept. 30 this year, intends to launch the proposed issue during the first quarter of the year.

Based on the registration statement filed with the SEC, the peso notes shall be redeemed at 100 percent of face value.

Citicorp Capital Philippines Inc., a member of Citibank N.A., was tapped as lead underwriter for the issue.