Globe sweetens offer to Bayan debt holders

MANILA, Philippines - Globe Telecom Inc., a joint venture between diversified conglomerate Ayala Corp. and Singapore Telecommunications, has sweetened its offer to the debt holders of Lopez-controlled Bayan Telecommunications Inc. (Bayan).

The Ayala-controlled telco provider has fixed at the highest level contemplated under the previous terms of the tender offer at $310 per $1,000 remaining principal amount of notes.

Globe likewise waived other debt offers condition requiring a 70-percent aggregate participation level with respect to the debt of Radio Communications of the Philippines Inc. (RCPI).

The company has also set the final settlement date of not later than Dec. 21 after a series of deadline extensions.

“These changes are announced at this time to provide greater certainty to holders of the notes and other debt as to the price and time of settlement of the tender offer and the concurrent offer,” the telco provider said in a statement.

As of Nov. 27, Globe has acquired close to 92 percent of the total remaining outstanding debt worth $184.5 million of cash-strapped Bayantel since the tender offer was launched last Nov. 6.

Globe made a tender offer to purchase for cash any and all of the 13.5-percent Senior Notes originally due 2006 issued by Bayan. The deadline was earlier extended to Dec. 18 instead of the first extension of Nov. 27.

Last Nov. 6, Globe assistant corporate secretary Marisalve Ciocson-Co told the Philippine Stock Exchange (PSE) that the company has commenced separate discussions with the controlling shareholders of Bayantel regarding a wide range of commercial arrangements including a potential acquisition by Globe of an equity interest in the cash-strapped company.

Once the offer is completed, Globe’s chief financial officer Albert de Larrazabal earlier said in a statement that the company would become the major creditor of Bayan and will perform the roles of Bayan’s creditors in respect to the rehabilitation plan.

“Potentially combining Globe’s assets and capabilities with (Bayan) through collaborative business efforts will enable both companies to become more competitive and will help accelerate the completion of Bayan’s rehabilitation,” Larrazabal said.

Globe said it has been in talks with debt-ridden Bayan “that will enable both companies to become more competitive in the current business environment.”