PLDT to issue new voting shares

Telecommunications leader Philippine Long Distance Telephone Co. (PLDT) secured its shareholders’ approval yesterday to issue new voting shares that will allow it to comply with the recent Supreme Court rule regarding foreign equity.

PLDT plans to issue 150 million preferred shares with voting rights that will lower it’s foreign equity from 59 percent to 35 percent, or below the 40 percent constitutional threshold, assuming the SC decision rendered last year in the Gamboa case becomes final and executory.

But if the SC reverses its ruling, PLDT may not push through with the issuance of the new class of shares.

In its ruling, which is the subject of a motion for reconsideration, the SC said that only voting shares, whether common or preferred, should be considered in computing the minimum 60 percent Filipino ownership requirement of public utilities under the 1987 Constitution.

PLDT has argued that the constitutional provision does not make any distinction between voting and non-voting shares. The company’s existing shares include common shares which are voting, and non-voting preferred shares. Prior to the SC ruling, the Securities and Exchange Commission (SEC) included nonvoting shares in determining compliance with nationalization requirements since the Constitution only mentions “total issued and outstanding” shares.

PLDT earlier said that only Filipinos will be able to subscribe to and own the new voting preferred shares that will be issued.

According to PLDT chairman Manuel V. Pangilinan, the initial contemplation is to issue the new shares to subsidiary PLDT Beneficial Trust Fund (BTF). “The advantage of issuing it to the BTF is that its interest is closely in line with that of PLDT,” he said.