March 29, 2011

[Local] PLDT acquires 51% of Digitel Telecommunications Phils.

PLDT or the Philippine Long Distance Telephone Co., today, acquired a 51.55% stake of Digitel Telecommunications Phils. The Gokongwei owned company closed the stock-to-stock transaction between PLDT with a transfer of stock worth P74.1 billion. With this acquisition, PLDT currently holds 67% of the Philippines' Cellular market. Gokonwei Group will also be getting a 12.8% stake at PLDT. 

This of course, will not only benefit PLDT and the man behind the company, Manny Pangilinan, but also it would benefit Digitel. Sun Cellular might not have the most stellar of services in the Philippines or anywhere in the world, for that matter, but with PLDT's infrastructure and resources this will definitely put Sun Cellular a much better competition with other wireless providers in the country.

James Go, CEO of Digitel's parent company, JG Summit have said:
“In making this decision, JG Summit went through a rigorous review of its strategic options and concluded that PLDT is the best partner for all our stakeholders – Digitel subscribers should reap benefits from PLDT’s sizeable infrastructure and leading-edge platforms. The transaction should also bring significant value to JG Summit’s shareholders without relinquishing our participation in the Philippine telecommunications industry”
So, for Sun Cellular subscribers like me, this is definitely good news. Sun Cellular over the years have proven that they are here to compete and is actually competing, being the Philippines' 3rd largest wireless network carrier. 

Globe in response to this acquisition, have said that they are also there "ready to compete". Of course, Globe's largest shareholder, SingtTel, will not let a PLDT monopoly in the future and we as the public consumers wouldn't like that idea.

Competition is key to any market. It is one of the most important factor that directs the prices of products. So with PLDT's move in acquiring half of Digitel's shares is good news.

Source: Techie


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