The board of Globe Telecom, a joint venture company (JVCo) of Singapore Telecommunications (Singtel), has approved a stock rights offer on June 20.
The company’s principal shareholders, Singapore Telecom International, a wholly-owned subsidiary of Singtel, and Ayala Corporation have both indicated their support for the offer.
Under the offer, the company says it expects to raise up to 32 billion pesos ($826.8 million), which will be used for the expansion of the mobile and broadband network as well as debt repayment.
The proposed stock rights offer will also enable the company to further expand its digital ecosystem. In addition, the offer will allow the company to differentiate itself in the market as it capitalises on opportunities in and beyond telco.
The common shares for this offer will be issued out of the increase in the company’s authorized capital stock.
Globe chief finance officer Rizza Maniego-Eala says, “This marks the first time Globe will do a rights offer in the capital market in over two decades and shows the principal shareholders’ confidence in the company and its plans going forward.”
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“We believe there is excitement in the market for Globe's future prospects and potential amid the massive demand for data-related services as more Filipinos are now embracing the benefits of digitalisation,” Maniego-Eala adds. “This capital raise will also provide Globe added flexibility to properly compete as we aim to continue delivering quality services to our millions of customers and keep our leadership position in the country. This effort will also further strengthen our balance sheet and empower us to further develop adjacent businesses that will enable the Filipino digital lifestyle.”
Shares in Singtel closed at $2.47 on June 17.
