Globe seeks lifting of TRO on Bayantel takeover

MANILA, Philippines - Ayala-led Globe Telecom Inc. has asked the Court of Appeals (CA) to lift the temporary restraining order (TRO) preventing the National Telecommunications Commission (NTC) from acting on the planned take over of cash-strapped Bayan Telecommunications Holdings Inc. (Bayantel).

In the Joint Rejoinder of Bayan-Globe to the 17th Division of the CA last October 30, both Globe and Bayantel sought the dismissal of the case filed by dominant carrier Philippine Long Distance Telephone Co. (PLDT) for “utter lack of merit.”

Globe maintains that PLDT’s “pushing its ‘bully’s agenda’ on flimsy grounds shows it would stop at nothing to prevent a P5-billion rehabilitation effort by Globe from seeing the light of day”.

 “Ironically, petitioner (PLDT) has the audacity to pontificate that Bayantel and Globe are the ones conspiring ‘to create an anti-competitive environment’ in the telco industry,” the company said.

Bayantel-Globe showed the appellate court that PLDT’s overstated right to be protected has no basis since Bayantel’s rehabilitation would simply put back a far third player on its feet - not becoming “unfair competition” at all. 

“Bayantel’s co-use of its radio frequencies with Globe “are not at all inimical to petitioner PLDT nor to the industry or the subscribing public as they will not only mean the success of Bayan’s rehabilitation but a benefit for the rapidly expanding consumer market by empowering them with more choices and faster and better products and services,” both firms added.

The joint petition also cited the Supreme Court ruling in the case “PLDT v. NTC”, that the “transfers of shares of a public utility corporation need only NTC approval, not Congressional authorization”.

 “Furthermore, there is no issue on the need for a Congressional approval with the alleged franchise transfer since what is being transferred are only Bayan’s shares of stock and not its franchise,” the rejoinder stated.

PLDT head of regulatory affairs and policies Ray Espinosa told reporters that there is a need for NTC to auction the radio frequency that has been unused by Bayantel 14 years ago.

 “The issue is the mobile frequency of Bayantel. It was assigned to them 14 years ago. That assigned frequency was given to them on the obligation that they will roll out their service, but they never rolled out a mobile service,” Espinosa said.

He pointed out that Globe could immediately take over the fixed line and broadband services of Bayantel immediately but not the mobile frequency of the cash-strapped company.

 “Under the law you have to use the frequency assigned to you otherwise it will be revoked. NTC should auction that frequency and Globe could participate,” he added.

Last Oct. 9, the Special 17th Division of the appellate court granted PLDT’s motion for the issuance of a TRO enjoining the implementation of the orders issued by the NTC allowing the continuation of the proceedings in connection with Globe and Bayantel’s joint application for regulatory approval.

The Pasig City regional trial court has approved the master restructuring agreement (MRA) between Globe and Bayantel. Under the transaction, Globe would acquire a 56.6 percent stake in Bayantel through the conversion of 69 percent of Bayantel’s total debt. In return, the outstanding principal debt of Bayantel would be reduced by 69 percent to $131.3 million from $423.3 million.

Last May 30, Globe and the Lopez Group asked the rehabilitation court to restructure Bayantel’s $423.3 million debt to prevent default. Bayantel’s outstanding debt stood at $497 million when it was placed under corporate rehabilitation in 2004. It has reportedly settled a total of P8.19 billion since it filed for supervised rehabilitation proceedings under the regional trial court in Pasig City and intends to pay its $325 million outstanding debt within 2023.