PHILIPPINE Telegraph and Telephone Corp. (PT&T) is set to start by next month the implementation of its debt-to-equity conversion, in line with its exit from court-assisted rehabilitation as granted by a Makati City Regional Trial Court (RTC).
In an Aug. 6 court decision uploaded to the stock exchange on Monday, it said the conversion to equity is targeted to begin on Oct. 5, when the company finishes its annual stockholders’ meeting scheduled on Thursday.
It noted, the company would be issuing “serial, cumulative, convertible and redeemable preferred shares and implementing the debt-to-equity conversion to pay the debts of PT&T to increase its authorized capital stock to P10,187,150,000.”
The authorized capital stock would consist of 1.38715 million common shares at P1 par value, 7.5 million serial cumulative convertible redeemable preferred shares at P100 par value and 8.8 billion serial redeemable preferred shares at P1 par value.
“This increase is to satisfy more or less P8 billion debts of PT&T,” it said.
The court decision said the Makati RTC could not complete the termination of the company’s rehabilitation proceedings until it accomplishes all items in the timetable it submitted to the court, which outlined the courses of action it is to take upon exiting.
“[T]his Court could not totally terminate the rehabilitation proceedings of PT&T at this time, in view of the timeline that petitioners submitted which are still to be accomplished by them. It is however, clear that the petitioners are in the right course leading to the path of successful rehabilitation,” it said.
Aside from the stockholders’ meeting this week and the debt-to-equity conversion next month, PT&T is also to start in November the settlement of statutory obligations until June of 2020.
“[T]he Stay Order shall remain effective during the duration of (the) rehabilitation plan,” it said.
In a bid to resume operations and join the government’s search for a so-called “third telco” player, PT&T is exerting various efforts to leave its corporate rehabilitation and resume trading of stocks in the Philippine Stock Exchange (PSE).
The telecommunications company was once PLDT, Inc.’s biggest rival in the telco industry, but has spent years slumped in debt that led to its application for voluntary suspension of trading in 2004.
PT&T signed an agreement with state-owned National Transmission Corp. (TransCo) in March for the use of the national fiber optic backbone facility of the government.
In a regulatory filing, the company said it recorded 43.4% smaller losses in 2017 at P26.906 million from the earlier year’s P47.565 million. — Denise A. Valdez