PLDT, JG Summit agree to extend anew closing date of Digitel sale

MANILA, Philippines - Telecommunications leader Philippine Long Distance Telephone Co. (PLDT) and JG Summit Holdings, Inc. have agreed to extend anew the closing date of the sale of the latter’s 51.55 percent stake in Digital Telecommunications Phils. Inc. (Digitel) covered by a sale and purchase agreement (SPA) dated March 29, 2011 from July 30, 2011 to Aug. 26, 2011.

PLDT and Digitel are awaiting approval by the National Telecommunications Commission (NTC) on their joint application for the approval of the sale as required by the Public Service Act (PSA). After securing NTC approval, the parties will then proceed with securing the necessary approvals from agencies and regulatory bodies, such as the Securities and Exchange Commission (SEC) and the Philippine Stock Exchange (PSE).

PLDT chairman Manuel V. Pangilinan pointed out that the regulatory process, which started in early April, has taken longer than we anticipated. “Nonetheless, our commitment to this deal remains unchanged because we are firm in our belief that the transaction stands to bring substantial benefits not only to the shareholders but also to the consumers and the general public,” he said.

Meanwhile, JG Summit chairman James Go said they are eagerly awaiting the decision of the regulators “so that we can proceed with closing the deal with PLDT.”

“This will translate to Sun subscribers benefitting from a stronger and more robust telecommunications company resulting from the PLDT-Digitel deal,” Go noted.

The NTC is expected to hand down its decision within the week, after having concluded its hearings two weeks ago and receiving all necessary documents from the various interested parties last week.

NTC Commissioner Gamaliel Cordoba earlier revealed that other issues being raised by the oppositors, which include Globe Telecom, Eastern Telecommunications Phils. Inc. and consumer groups, such as those dealing with IP peering, redistribution of frequencies, and interconnection do not necessarily have to be resolved during this particular proceeding. “They can be the subject of other NTC issuances,” he said.

PLDT, in its memorandum to the NTC, emphasized that under the PSA, these type of proceedings should only be summary in nature and do not require full-blow hearings, and that the issues being raised by the oppositors are extraneous to the issue at hand.

Meanwhile, a senior PLDT official said yesterday that Globe is resorting to desperate, last-minute arguments in an attempt to block the approval of PLDT’s investment in Digitel by the NTC.

“Globe’s claim that the Supreme Court has already ruled that PLDT is not a Philippine national nor a duly authorized domestic public utility is a flagrant distortion of the high court’s ruling,” PLDT regulatory and policy affairs head Ray Espinosa said.

Espinosa noted that Globe cannot even acknowledge the plain and simple fact that the SC decision on the Gamboa vs. Teves et al case is not final and executory and thus still subject to reconsideration.

He pointed out that Globe used this very same argument in asking the NTC to indefinitely postpone hearings on the Digitel transaction. But the NTC rejected Globe’s motion, pointing out that indeed the SC ruling was not yet final and did not bar the Commission from continuing its hearings on the case.

As for the definition of Philippine national provided for under the Foreign Investments Act of 1991, Espinosa said that this restriction applies to companies seeking incentives under Republic Act 7042 and does not apply to the case at hand.