SMC focuses on Eastern Communications

MANILA, Philippines - While it may be open to selling its businesses “at the right price,” San Miguel Corp. continues to go on an acquisition binge, this time setting its sights on Eastern Communications Inc.

San Miguel president and chief operating officer Ramon S. Ang told The STAR that they are looking at the possibility of acquiring Eastern Communications, the oldest existing telecommunications provider in the country with a particular focus in providing voice, data and Internet services.

“We are reviewing their offer,” Ang said.

Eastern Communications is controlled by listed information technology firm ISM Communications Corp. of former Trade and Industry Minister Roberto V. Ongpin and British investment fund Ashmore Group Plc. 

ISM acquired a substantial stake in ETPI in 2006. Since then, ISM has increased its stake in Eastern Communications to a controlling super-majority.

Ongpin is one of the major shareholders of Top Frontier Investments Holdings, which is expected to own the single biggest stake in San Miguel. In November last year, Top Frontier acquired a 28-percent stake in the food-to-power conglomerate for P64.3 billion.

Ongpin also controls nearly a third of Q-Tech Alliance Holdings Inc., which bought a 20-percent stake in San Miguel in February from Japanese brewer Kirin Holdings Co. Ltd.

Analysts said the acquisition of Eastern Telecommunications would fit well into San Miguel’s growing portfolio as it would complement the Internet broadband service of Liberty Telecommunications Holdings Inc. (LTHI), in which the diversifying conglomerate holds a 32.7-percent interest.

LTHI, a joint venture between San Miguel and Qatar Telecommunications, focuses on internet broadband and WiMax, which are expected to account for more than 90 percent of projected sales and subscriber base. It is planning to launch voice-over-internet protocol (VOIP) with focus on offering competitive international package.

Eastern Communications offers internet services such as Eastern DSL, Go Premium Internet card, DSL pre-paid among others. It also has value-added services such as dataHUB, a secure reliable data facility, and Eastern Digimaps for map-based information management solution.

Besides the traditional bandwidth and connectivity solutions, the company’s new products include wireless access, services for high-end Internet cafés, a new data center, business applications and special packages for small and medium enterprises and corporations.

Eastern Communications is laying down a 240-kilometer fiber network to service industrial parks and economic zones in Tagaytay, Cavite, Laguna and Batangas.

San Miguel has been actively diversifying its portfolio away from food and beverage and is eyeing high growth sectors like power, infrastructure, telecommunications and mining.