San Miguel lines up stake in Extelcom

21 Jul 2009

Philippines beer and food firm San Miguel has confirmed it plans to buy a stake in failed local cellco Extelcom.

It is negotiating with private equity firm Ashmore and local businessman Roberto Ongpin for the sale of their stake in the firm, which has collapsed owing P9.017 billion ($187 million).

Sans Miguel said in a statement to the Philippine Stock Exchange that it was in talks with stockholders over "the possible acquisition" of a stake in the firm.

It said it needed time to complete due diligence into Extelcom, which has been racked by legal battles between its shareholders.

Extelcom is still running one of the world's last analog mobile networks, but its 850 MHz spectrum makes it an attractive target.

San Miguel's disclosure comes two weeks after it bought 32.7% of Liberty Telecom, another debt-ridden telco, for $37 million. With Qatar-based QTel as fellow shareholder, it has said it will spend as much as $500 million on a nation-wide Wimax network.

As part of its diversification, the beverage firm has also bought stakes in power utility Manila Electric and Petron, the country's biggest oil refiner.

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