SEC approves PT&T capital hike reversal

MANILA, Philippines — Philippine Telegraph & Telephone Corp. (PT&T) has secured a favorable response from the corporate regulator to reverse a previously approved capital hike.

In a disclosure to the local bourse, PT&T said the Company Registration and Monitoring Department (CRMD) of the Securities and Exchange Commission had issued an order revoking the increase of its authorized capital upon its request.

The CRMD likewise issued in favor of PT&T an unconditional certificate of good standing.

In 2018, the CRMD approved the increase of PT&T’s authorized capital, which was subject to the condition that the company shall submit the deeds of assignment signed by its creditors.

The authorized capital of PT&T was increased to accommodate the conversion of its debts into equity as mandated under its rehabilitation plan.

PT&T, however, said it encountered difficulties in securing all the deeds of assignment from its creditors considering the number of years that elapsed from the time the debts were incurred.

The company said the debt-to-equity conversion mandated under its rehabilitation plan would still be implemented “albeit in several tranches and only after securing the deeds of assignment from its creditors.”

In line with the company’s request, PT&T said the SEC’s Office of the General Counsel (OGC) sought the opinion and recommendation of the Office of the Solicitor General (OSG).

“After being informed by the OGC that the OSG is of the opinion that the increase in PT&T’s authorized capital may be revoked, the CRMD issued an order dated April 27, 2021 revoking the increase of PT&T’s authorized capital,” the listed company said.

PT&T cut its net loss to P31.3 million last year from P52.4 million in 2019, as revenues rose eight percent to P408.34 million.

While stringent lockdowns impacted most small and medium enterprises, the drive for increased demand in connectivity to support work-from-home and online learning arrangements pushed revenues from its fixed broadband services to increase by eight percent to P384 million.

PT&T officially exited from a court-assisted corporate rehabilitation in late 2018, and has since pursued plans to expand and transform into a digital services provider.