Philippine mobile operator Globe Telecom Inc is injecting $300 million in fresh capital into its recently-owned subsidiary Bayan Telecommunications Inc (Bayantel) as the latter ended its corporate rehabilitation.
Globe’s chief operating officer Gil Genio made the disclosure on Thursday following the release of the court order. He is now also the newly-appointed chairman of Bayantel.
Genio told reporters that Globe might spend $200 million to $300 million for Bayantel’s network modernisation alone.
The former debt-stricken telco firm underwent a court-assisted corporate rehabilitation in 2003 and in 2013, the Pasig City Regional Trial Court Branch 158 confirmed the Amendment of Bayantel’s Rehabilitation Plan wherein Globe, as Bayantel’s principal creditor, was authorised to convert its debt holdings into a controlling interest of at least 54 per cent in Bayantel’s outstanding shares.
Globe has so far spent $172 million in Bayantel as it invested almost $40 million when it increased its stake to 98.57 per cent, followed by the debt-to-equity conversions.
The Ayala-led telco firm last July purchased all the equity in the capital stock held by Bayantel and Lopez Holdings Corp (LHC)..
Bayantel’s planned rehab exit was supposed to be in 2023, but Globe’s entry in 2013 cut short the process.
Globe aims to boost both companies’ respective network improvement programmes targeted at providing world class telecommunication services, as it will provide technical and financial support but at the same time maximizing Bayantel’s frequencies.
Globe’s last trading price decreased 0.43 per cent or P10.00 to close at P2,310.