Philippine company DITO CME Holdings, the parent firm of third telco DITO Telecommunity, has denied a report in local media that one of its investors, Singapore-based Summit Telco Holdings, is moving to take over the company.
DITO CME chair Dennis Uy currently holds a 54.77% stake in the company via Udenna Corp, while recently incorporated Summit Telco Holdings owns 16.89%. The latter’s parent company, Summit Telco Corp of Singapore, holds 8.14%.
On Monday, the Philippine Star – citing an anonymous source – reported that Summit Telco Holdings intends to buy enough shares from Udenna Corp to take a majority stake in DITO CME, while Uy would retain a minority share.
The source told the newspaper that Summit Telco Holdings wants to “go all in” on DITO CME: “They are here to support the company.” Such a deal would also give overseas investors majority control of DITO CME.
However, in a filing to the Philippine Stock Exchange late Monday, DITO CME stated that “there have been no definitive agreements that have been executed with respect to the majority takeover of DITO CME.”
DITO CME said it will “make the necessary disclosures and seek the appropriate regulatory approvals if such a transaction is executed, as required by the rules of the Securities and Exchange Commission and The Philippine Stock Exchange.”
Summit Telco Holdings bought PHP3.3 billion (US$56.5 million) worth of common shares in DITO CME in October 2023. The proceeds from that sale were invested into DITO Telecommunity to fund the rollout of its telecom business.
According to its latest financial results for Q1 2024, DITO CME saw revenues jump 62% year on year to PHP3.79 billion, most of which was driven by DITO Telecommunity’s mobile business. DITO’s mobile data revenues for the same period grew 39% to PHP2.55 billion.
However, DITO CME widened its net loss for the quarter by 12 times to PHP4.11 billion due to a 31% spike in expenses, as well as foreign currency exchange losses.
