DITO firms up Summit sale

The third telco,  DITO Telecommunity Corp., has started setting the stage for a multi-billion-peso boost from a close ally—with boardroom heavyweights already working out the fine print.

DITO CME Holdings Corp, the parent firm of DITO Telecommunity, has confirmed the approval of a potential investment from Summit Telco Corp. Pte. Ltd.

The company informed the stock exchange on Monday that it had signed a subscription framework agreement with Summit Telco, an existing shareholder.

If all goes according to plan, the coming months could see up to nine billion new shares on the horizon, with top executives authorized to seal the deal and secure the company's financial footing.

“The implementation of Summit Telco’s potential investment under the Subscription Framework Agreement, along with other equity-raising efforts, forms part of the Company’s business plan to improve its equity positions as previously disclosed,” DITO CME said.

Terms being ironed out

The company’s board authorized Chairman Dennis A. Uy and President Donald Patrick L. Lim to finalize the terms of the investment, including the amounts, timing, and tranches of the subscription.

Last year, Summit Telco’s wholly owned subsidiary, Summit Telco Holdings Corp., entered a subscription agreement with DITO CME worth P3.3 billion, enabling the issuance of 3.3 billion common shares at P1 per share. 

Summit Telco currently holds 8.14 percent of DITO CME’s outstanding shares, while Summit Telco Holdings and Udenna Corp. hold 16.89 percent and 54.77 percent, respectively.

To enhance its financial position and support growth, DITO CME announced last August that it plans to raise as much as P40.26 billion from private investors over the next five years.