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San Miguel Sells Telecoms Assets for US$1.5 billion

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Philippines based San Miguel Corp has sold its telecoms assets to the country's two rival operators, Globe Telecom and PLDT for a combined USD1.5 billion.

San Miguel had announced plans to launch the country's third mobile network back in 2014, but plans to set up a joint-venture with Australia's Telstra to run the network foundered and were scrapped earlier this year.

It was felt that the government's restriction barring foreign investors from owning more than 40 percent of a telecoms business was the main reason for the joint venture talks breaking down.

Although San Miguel said it would continue to build the third mobile network, it has now agreed to sell the assets it built up to the two incumbent operators -- each taking 50 percent of the assets.

Under the agreement, PLDT and Globe will pay 52.08 billion pesos for all the shares of the subsidiary company, Vega Telecom, and assume about 17.02 billion of liabilities, according to the statement.

Part of the deal also sees some of the radio spectrum returned to the government which is expected to make another attempt at promoting a third mobile network in the country.

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Tags: Philippines