DITO CME Holdings takes greater control of NMP via share swap deal

12 Nov 2020

ABS-CBN News reports that DITO CME Holdings is acquiring Udenna Communications and Media Entertainment Holdings (Udenna CME) through a share swap deal valued at up to PHP77 billion (USD1.6 billion), as it looks to take greater control of DITO Telecommunity – the country’s third telco player, or New Major Player (NMP). In a statement this week (10 November), DITO CME Holdings confirmed plans to purchase 100% of Udenna CME from Udenna Corp, in exchange for 11.2 billion DITO Holding shares which will be issued at between PHP6.00 and PHP6.90. The paper goes on to note that ‘powered by the share swap merger’, DITO Holdings will ‘absorb and have an indirect hold’ in the country’s new third telco – which is looking to take the fight to PLDT Inc. and Globe Telecom when it launches in March 2021 – through Udenna CME.

Udenna CME holds 58% of privately owned DITO Holdings, the company purchasing DITO Telecommunity shares from Udenna Corp. The merger acquisition will reportedly ‘transform DITO CME from a shell company to a telco-focused holding firm’.

Confirming the reorganisation, DITO CME President Eric Alberto said: ‘This is one step of our plan of realising DITO CME’s ownership of DITO Telecommunity, through Udenna CME and DITO Holdings Corp. DITO CME will end up as the beneficial owner of the Udenna Group’s equity interests in DITO Telecommunity, excluding those under Chelsea Logistics and Infrastructure Holdings Corporation.’ Alberto’s company believes that indirect ownership to DITO Telecommunity ‘presents various options for capital infusion to enable the telco firm’s future infrastructure investments’.

Earlier this month Chelsea Logistics and Infrastructure Holdings sold a 25% stake in DITO Telecommunity to DITO Holdings. Chelsea Logistics confirmed that its board of directors had approved the sale of its 40.833 million common shares and 22.917 million preferred shares of DITO Holdings. The statement said: ‘The transfer of the shares is only for the purpose of restructuring Chelsea Logistics and Infrastructure Holdings Corp.’s shareholdings in DITO Telecommunity, and to streamline the shareholdings of the Corporation and of Udenna Corp in DITO Telecommunity through a holding company, DITO Holdings.’

Philippines, DITO Telecommunity Corp (formerly Mislatel)