A Philippines court has approved a debt restructuring plan that will see Globe Telecom become the majority shareholder of struggling fixed-line operator Bayan Telecommunications (BayanTel).
BayanTel was forced to enter court-appointed rehabilitation in 2003 and has incurred over $400 million in debt. Globe last year arranged to acquire nearly all of this debt, becoming BayanTel's main creditor.
Globe recently proposed a debt restructuring plan involving converting up to 69% of this debt into shares worth up to a controlling 56.6% of BayanTel.
A court overseeing the debt restructuring has now approved this plan, the Manila Standard Todayreported.
Globe has previously indicated that once the restructuring concludes, it may seek to acquire the remaining shares in BayanTel for a full takeover. Besides BayanTel's fixed assets, it has 10 MHz of 1,800-MHz spectrum that it shares with Globe.
BayanTel expects to remain in court rehabilitation until 2023, and a takeover could address this issue.
BayanTel this week announced a partnership deal with Indonesia's Telin, a subsidiary of PT Telkom, to enable it to provide connectivity services to Indonesia, Singapore Hong Kong, Timor Leste and Australia.