14 Apr 2011
The president of the Philippines, Benigno Aquino, yesterday called for a review of Philippine Long Distance Telephone Company (PLDT’s) proposed takeover of fellow operator Digital Telecommunications Philippines Inc (Digitel), amid antimonopoly concerns in the country. At the end of last month PLDT, the Philippines’ largest telco by subscribers and revenues, agreed to buy a 51.55% equity stake in number three operator Digitel in a PHP74.14 billion (USD1.70 billion) cash and share swap. However, the government and the regulator, the National Telecommunications Commission (NTC), have expressed concerns the plan will undermine competition in the domestic market. President Aquino told reporters that while it was too soon to say if the takeover is anti-competitive, there is enough concern to warrant a study. ‘We want to ensure there is a level playing field,’ he said.
TeleGeography’s GlobalComms Database writes that a tie-up between PLDT’s mobile units Smart Communications and Red Mobile, which between them control 52.6% of the domestic mobile market, and Digitel’s Sun Cellular brand would result in the enlarged group controlling 70.1% of the local mobile sector. Second-placed Globe Telecom currently has around 29.8% and its president Ernest Cu is on record as saying the deal should at the very least ‘spark debate among lawmakers for legislation that will govern potential anti-competitive practices’.