MANILA, Philippines - The National Telecommunications Commission (NTC) has allowed Smart Communications, the wholly-owned mobile subsidiary of Philippine Long Distance Telephone Co. (PLDT), more time to submit updates on the preparation for the divestment of PLDT of its interest in Connectivity Unlimited Resources Enterprise Inc. (CURE).
Smart legal and regulatory department head Enrico Espanol wrote the NTC asking that it be given an additional 10 days from April 13 to update the NTC on the status of the divestment plan.
According to Espanol, they are still coordinating with pertinent groups responsible for several phases of the divestment and collating their updates. “We are also finalizing the migration plan for CURE subscribers,” he said.
As a condition to approving the acquisition by PLDT of a majority stake in Digital Telecommunications Philippines Inc. (Digitel) last year, the NTC required PLDT to divest itself of CURE, with the latter’s franchise, telecommunications frequencies, and related permits to be later sold via an NTC-supervised competitive public bidding among duly enfranchised and qualified public telecommunications entities (PTEs).
The divestment of CURE, which owns much-sought-after10 Mhz of 3G frequency in the 2100 band, will follow a plan which is detailed in the NTC decision and was the subject of earlier negotiations between the regulator and the PLDT.
Under the plan, CURE will sell its Red Mobile business to Smart consisting of its subscriber base, brand, and fixed assets. Smart will then sell all of its rights and interests in CURE whose remaining assets will consist of its congressional franchise, the affected frequency, and related permits.
PLDT will have nine months to effect the orderly migration of CURE’s customers as well as an orderly transfer or CURE’s assets to Smart with the least disruption and degradation of service to CURE’s existing customers. The transition period will be reckoned from the date of promulgation of the decision.
The divestment will be made under the supervision and control of the NTC. And will be effected through a competitive bidding among PTEs. A minimum price will be prescribed to allow Smart to recover its investment in acquiring, developing, and operating CURE.
In case the actual proceeds from the sale exceed the cost recovery amount, PLDT will pay the NTC as fee for supervising the divestment sale, at least 50 percent of such excess less government fees and taxes payable as a consequence of the sale.
The NTC added that while the divestment is pending, the PLDT Group will not use the affected frequency.