Ayala, Globe sign buyback deal

Ayala Corp. and its telecommunications unit Globe Telecom have signed an agreement that would allow them to buy back the offered shares of Germany’s DeTeAsia Holdings GmbH in Globe, hence increasing their shareholdings in the Philippines’ second largest telecoms company.

In separate disclosures filed with the Philippine Stock Exchange, AC and Globe said they have signed a definitive agreement covering the purchase from DeTeAsia of 10.04 million shares and 12 million Globe shares, respectively, at P680 per share.

DT is a 100-percent subsidiary of the debt-laden German phone giant Deutsche Telekom AG.

AC expects to close the deal on Oct. 30 while Globe anticipates the deal to be finalized on Oct. 24, subject to the appropriate approvals from the PSE.

AC, Globe and Singapore Telecom International Pte. Ltd., a wholly-owned subsidiary of the government-controlled Singapore Telecommunications Ltd. (SingTel), have accepted DT’s fresh offer to sell its 37.67 million common Globe shares, just two days after receiving the new offer.

AC holds a 32.7-percent stake in Globe while SingTel, Asia’s sixth largest telecoms company, accounts for 29.1 percent. The balance is held by other smaller investors, including the public.

Deutsche Telekom, Europe’s biggest telecom operator, has already sold all of its Asian mobile holdings, having also disposed of its stakes in Malaysia’s Celcom Malaysia and PT Satelit Palapa Indonesia (Satelindo) for about $440 million.

Once the Globe transaction is completed, Deutsche Telekom will be represented in the region solely by its business services subsidiary T-Systems, which has branches in Hong Kong, Japan, Singapore and the Philippines.

Globe president and chief executive officer Gerardo Ablaza Jr. said they "are pleased to have addressed a number of important issues in this transaction and at the same time resolving the uncertainty that existed with DT’s departure."

Citigroup Global Markets has been engaged as financial advisor to the special committee formed by the Globe board to decide on Globe’s participation in the sale of DT stake.

DT’s parent company Deutsche Telekom continued to suffer massive losses in its worldwide operations. It offered the shares to partners Ayala and Singtel in pursuance of the right of first offer available to the two companies.

It used to own part of Isla Communications (Islacom) when Globe bought the company, receiving shares in Globe under a share-swap agreement.