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Liberty Telecoms to lease out telecom assets, paper says

3 Jun 2015

Liberty Telecoms Holdings – which is a joint venture between San Miguel Corp (SMC) and Ooredoo, and has two subsidiaries, Wi-Tribe Telecoms and Skyphone Logistics – is considering leasing out more telecommunications assets as part of wider plans to exit corporate rehabilitation status, the Philippine Daily Inquirer reports. Liberty Telecoms is conducting a broad review of its operations as part of the exit strategy and its president and CEO Bienvenido Banas is quoted as saying that the loss-making company, which booked net losses of PHP210.16 million (USD4.74 million) for the period January-March 2015, down 31.6% from a loss of PHP307.59 million in the year-earlier period, is considering leasing out more than half of its 500 base stations in Metro Manila to other telecoms service providers.

Liberty’s main focus of interest is its WiMAX wireless broadband venture Wi-Tribe Telecoms, but it notes that subscriber numbers have been declining in recent years amid stiff local competition. Liberty has 50,000 pre-paid and post-paid subscribers, Banas said, but admits: ‘Right now, we need cash to support existing operations’. Leasing out its telecommunication assets would allow Liberty to generate ‘new revenues’, he said. Despite cutting its losses, Liberty’s core revenue continues to fall. Total service revenue hit PHP42.17 million in 1Q15, down 46% year-on-year, which it attributed to the lower average revenue per user (ARPU) and a decline in subscribers. Although its operating costs were also down – expenses fell to PHP280.9 million from PHP323.4 million in 1Q14 – the telco said that the drops were due to a decline in business activity as it cut its workforce by 25% in the first quarter and reduced its leased sites late last year.

On 12 May 2015 the Makati City Regional Trial Court approved Liberty Telecoms Holdings’ early exit from rehabilitation, a year ahead of the telco’s scheduled exit in 2016. In a filing to the Philippine Stock Exchange, Liberty said that the court also discharged lawyer Monico Jacob of his duties and responsibilities as rehabilitation receiver. ‘The exit from rehab paves the way for us to consider some of these options,’ Banas added.

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