Globe securing P7-B bank loan for capex

Globe Telecom Inc. is entering into a P7 billion loan agreement with a local bank for capital expenditures.

The Ayala- led telco also expects to free up about $600 million on its balance sheet which could be used for future fund raising activity.

“We do need financing for our capex so we have another P7 billion more that we need to fund for our capex,” Globe chief finance officer Rizza Maniego-Eala said in a briefing yesterday.

She said Globe expects to sign the agreement with a local bank in the next few days.

Globe set its capital expenditures at $ 750 million this year.

As of end-June, Globe has spent around P17 billion capital expenditures to support its growing subscriber base and the increasing demand for data.

“We are going through a consent solicitation, specifically for our retail bonds, to increase our D/ E ( debt- toequity) ratio from two times to 2.5 times. That just gives us the flexibility to be able to prepare for any future capital expenditure that we need,” Eala said.

Eala said the move could free up about $600 million on its balance sheet which could be used to raise funds either through debt or equity in the future.

The consent solicitation would commence on Aug. 8, and expire on 5 p.m. on Sept. 5.

On Globe’s purchase of half of the telco assets of San Miguel Corp., Eala said the company would no longer need to raise funds to fund the acquisition.

“As far as acquisition is concerned, we have been able to fund it. Our balance sheet can very well take the acquisition,” she said.

In another development, Globe said the Court of Appeals has approved the urgent motion to merge its petition against the Philippine Competition Commission with PLDT Inc.