Globe maintains foreign ownership way below 40% limit

MANILA, Philippines - Globe Telecom maintained yesterday that its foreign ownership stands at 29.33 percent or way below the 40-percent limit for Philippine public utilities.

Globe chief financial officer Alberto de Larrazabal told the Philippine Stock Exchange that consistent with the Supreme Court ruling, Globe’s total issued preferred shares - like its common shares - have voting rights.

In the so-called Gamboa ruling, the Supreme Court said the word “capital” under the Constitution only contemplates voting shares, whether common or preferred.

Earlier, PLDT regulatory affairs head Ray Espinosa revealed that Globe’s capital structure shows that its single biggest common shareholder is Singapore Telecom (SingTel), a foreign company, which owns approximately 47.3 percent of Globe’s total issued and outstanding common shares. About 60 percent of the shares owned by foreigners are common shares and the remaining are preferred shares.

In its various submissions in relation to the joint application by PLDT and Digital Telecommunications Phils. Inc. (Digitel) seeking approval by the National Telecommunications Commission (NTC) of PLDT’s proposed acquisition of a majority stake in Digitel, Globe has maintained that the planned merger should be disallowed and that PLDT’s authorizations to engage in the telecommunications business should be withdrawn since PLDT is more than 40 percent foreign-owned.

The 1987 Constitution provides that “no franchise, certificate, or any other form of authorization for the operation of a public utility shall be granted except to citizens of the Philippines or to corporations or associations organized under the laws of the Philippines at least sixty percentum of whose capital is owned by such citizens...”

When asked whether PLDT intends to make a legal case out of its new revelation, Espinosa said: “We are not at that level yet. We are just making a point because Globe has been attacking the ownership structure of PLDT. The public should become aware of Globe’s double speak. As you know, the Gamboa ruling is not yet final and motions for reconsideration have been filed by several parties. Despite this, Globe keeps painting a bad picture of PLDT. So it’s time that people see Globe’s real reflection.”

Espinosa also pointed out that just like PLDT, Globe also has preferred shares. “Globe preferred shares have a much low par value (P5 per share) and a much lower dividend yield than Globe common shares (par value P50 per share). Unlike PLDT preferred shares which are owned by millions of Filipinos, the entire issued and outstanding Globe preferred shares - totaling 158,515,021 shares - are owned by one company, Asiacom Philippines, Inc., which is 60 percent owned by Ayala Corporation and 40 percent owned by Singapore Telecom Int’l Pte Ltd, a foreign corporation. This means that 40 percent of the Globe cash dividends received by Asiacom Philippines, Inc. also go to a foreign company - Singapore Telecom,” he emphasized.