SMC plans to increase stake in Eastern Telecom to majority

MANILA, Philippines - San Miguel Corp. (SMC), through its wholly-owned subsidiary Vega Telecom Inc., is eyeing a majority stake in Eastern Telecommunications Phils. Inc. (ETPI), a company controlled by businessman and former Trade Minister Roberto Ongpin, in a bid to fortify its presence in the local telecommunications sector.

SMC president and chief operating officer Ramon S. Ang revealed that Vega Telecom is “likely to acquire” the remaining 37.7 percent stake of ISM Communications Inc. in ETPI.

Vega earlier bought Ongpin-controlled AGM, which owns 40 percent of ETPI. The remaining 22-percent stake is owned by the Africa family, which is being claimed by the government.

ISM president Eric Recto earlier said the company is in talks with potential buyers of the company’s remaining stake in ETPI.

The 37.7-percent stake of the Ongpin group in ETPI has a book value of P1.14 billion.

Ang earlier said the company was looking at acquiring the entire 77-percent stake of the Ongpin group in ETPI as part of its expansion in the telecommunications sector.

Vega also owns 100 percent of Bell Telecom and a 32.7 percent stake in Liberty Telecom. It is also earlier eyeing the controlling stake of Trans-digital Excel Inc., another company identified with Ongpin, in Extelcom.

ETPI provides data and Internet leased circuits, full-service telephony and managed telecom services.

ISM will also likely sell its indirect stake in Acentic, an international provider of information technology services to hotels and hospitals. The book value of ISM’s 32.5-percent stake in Acentic is estimated at P660 million.

Meanwhile, Ang said SMC, through subsidiary Optimal Infrastructure, is looking for a foreign technical partner for the operation and maintenance of Metro Rail Transit (MRT) Line 3 and Light Rail Transit (LRT) Line 1.

Optimal bought the bid documents for the P15-billion project, together with Metro Pacific Investments Corp., Ayala Corp. and First Balfour Inc. of the Lopez Group among others.

MPIC is partnering with Miescorrail, a subsidiary of Meralco Industrial Engineering Services Corp., (Miescor) for the rail project.

Opened in 1999, the 13-kilometer MRT 3 runs from North Avenue in Quezon City to Taft Avenue in Pasay City, where average daily ridership is estimated at 400,000.

LRT 1 is a 17-kilometer elevated train system that runs from Roosevelt Station in Caloocan to Baclaran in Pasay City.