Corporate News

By Keith Richard D. Mariano,

PSE approves Liberty Telecoms delisting

Posted on November 17, 2016

THE PHILIPPINE Stock Exchange, Inc. (PSE) has cleared Liberty Telecoms Holdings, Inc.’s delisting from the bourse by Monday.

In a memorandum issued on Tuesday, PSE President and Chief Executive Officer Hans B. Sicat said the exchange granted the petition of Liberty Telecoms for voluntary delisting.

The PSE accordingly ordered the delisting of the company’s shares from the official registry of the exchange effective as of the start of business hours on Nov. 21.

Trading of shares in Liberty Telecoms is currently suspended, as a result of the voluntary tender offer made by controlling shareholder Vega Telecom, Inc.

“The cross of the tendered shares resulted in the reduction of the company’s public ownership level from 12.82% to 4.55%, below the required minimum percentage,” Mr. Sicat noted in the memorandum.

A block sale was implemented on Nov. 4 for the shares tendered to Vega Telecom from Aug. 24 to Oct. 20. Trading in the shares of Liberty Telecoms was suspended thereafter.

The voluntary tender offer came after telecommunications giants PLDT, Inc. and Globe Telecom, Inc. took over Vega Telecom from San Miguel Corp. (SMC) in a P69.1-billion transaction.

Vega Telecom’s new controlling shareholder and management then resolved to delist Liberty Telecoms and, thus, offered to acquire the remaining 12.82% stake comprising 165,883,221 common shares in the company for P2.20 apiece.

The pricing of the tender offer had raised questions from certain minority shareholders because Liberty Telecoms was known to have been assigned a portion of the coveted 700-megahertz band.

The frequencies, it turned out, were transferred to associate Bell Telecommunication Philippines, Inc. as early as March 2015. Liberty Telecoms failed to timely disclose the material information.

In an assessment letter dated Oct. 20, the Securities and Exchange Commission fined Liberty Telecoms with P346,000 for withholding information surrounding the reassignment of frequencies from the investing public.

The omission of the material fact in filings required by the corporate regulator warranted a monetary penalty amounting to P100,000 for the first offense plus P500 for each day of continuing violation.

The SEC, at the same time, reprimanded Liberty Telecoms for non-filing of current reports; incomplete quarterly reports for the entire 2015 and the first three months of the current year; and incomplete annual report.

In an earlier interview, SEC Commissioner Ephyro Luis B. Amatong noted the regulator’s findings should have no implication on the pricing of the tender offer.

Mr. Amatong had cited the argument of SMC that assigned frequencies are not owned by the concerned telecommunication companies, which merely acquire the privilege of using them from the government.

The SEC official further noted that Vega Telecom made a voluntary tender offer in relation to the planned delisting of Liberty Telecoms from the stock exchange.

Accordingly, the tender offer should supposedly remain valid regardless of the outcome of the ongoing review by the Philippine Competition Commission on the takeover of the telecommunication assets of SMC by PLDT and Globe.

In a regulatory filing, Liberty saw its net loss shrink to P46.3 million in the third quarter from P180.18 million from the same period a year ago.