Philippines watchdog probes Globe Telecom deal

20 June 2016 |


Philippines watchdog has announced it will investigate Globe Telecom and PLDT's joint acquisition of San Miguel Corp's (SMC's) assets.

The Philippines Competition watchdog has announced it will investigate Globe Telecom and PLDT's joint acquisition of San Miguel Corp's (SMC's) telco assets.

The regulator is not happy with the transaction documents submitted by the operators to the Philippine Competition Commission (PCC).

"We have formally put the parties on notice that we will pursue a comprehensive review of their acquisition of SMC's telco businesses, and we shall approve or disapprove the subject transaction after the conduct of such full review," the PCC said in a statement Friday.

The companies have been told that the PCC will undertake a comprehensive review of their acquisition of SMC’s telecoms businesses, and that it may rule against the proposed merger.

“We assessed the new submissions of the parties, and based on the totality of information available to us, including public statements made by the parties, we believe there is a basis to conduct this review by virtue of the powers granted to the Philippine Competition Commission (PCC) by the Philippine Competition Act (PCA)” the PCC said last week.

“A comprehensive review includes a determination of the relevant market, whether there will be substantial changes to the market structure, and the potential impact of the transaction on public welfare. The review is intended to ensure that the transaction will, in the end, result in sustained gains for the public by not restricting competition.

Globe and the incumbent PLDT agreed to acquire 50% each of SMC's telecoms assets in May 2016 for 52.85 billion pesos (€1.02 billion). The agreement included spectrum held by SMC's subsidiaries.

Globe and PLDT have already resubmitted their merger notifications to the PCC along with new, requested information.

"We assessed the new submissions of the parties, and based on the totality of information available to us, including public statements made by the parties, we believe there is a basis to conduct this review," the PCC said on Friday.

The investigation will examine whether the SMC deal will cause significant changes to the structure of the Philippines mobile market.