Calling the deal a “master stroke” for San Miguel, Jonathan Ravelas, chief market strategist at Manila-based BDO Unibank Inc., told Bloomberg, “They will be getting a large sum and sparing themselves from a bruising fight in an industry that is getting more competitive and bloodier had Ang pushed through with telecoms”.
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PLDT and Globe will each acquire half of the equity interest of SMC’s telecommunications business, PLDT said in a disclosure to the Philippine Stock Exchange on Monday.
The strategy of Globe Telecom is to grab the unused 700 MHz spectrum available with San Miguel, one of the main rivals of Globe Telecom, and build its mobile Internet business. “We’re hoping that with the twin projects for enterprises and individual customers, they will have access to a more reliable and resilient network that addresses their need for ultra-fast data connectivity”. PLDT, in an advisory, said Pangilinan will hold a media briefing Monday.
The surprise development comes as SMC, a diversified conglomerate that planned to launch a rival service this year to compete in the industry’s hottest segment-mobile high-speed internet-was made to face hurdles on nearly all fronts in its bid to become a viable third telco player.
– Acquisition involves a return of certain radio frequencies to the Government, which will allow 3rd competitor to enter the market.
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San Miguel’s about-face on its planned telecommunications foray came after its supposed partner, Australia’s Telstra, backed out of the venture, apparently spooked by PLDT and Globe’s persistent government lobbying to parcel out the 700MHz frequency band. “At the same time, it leaves the door open for new entrants into the industry”. San Miguel shares were flat after having risen as much as 3.4 percent earlier.
