NOW Telecom Company Inc. said Tuesday it plans to tap the debt or equity market after securing an approval from the Securities and Exchange Commission for an increase in authorized capital stock, quasi-reorganization of its equity and stock split.
“This strategic initiative of NOW Tel is envisioned to support its growth plans. The three-step equity restructuring better positions NOW Tel for investors both domestic and foreign to participate in its equity,” said NOW Telecom president and chief operating officer Rene Rosales.
“With the amended Public Services Act allowing up to 100-percent foreign ownership in public utility companies and this recent approval from SEC, NOW Tel can now proceed in its growth plans starting with its fundraising efforts including but not limited to tapping either the debt market or equity market, or both,” he said.
NOW Tel said that as a result of the approved application, it increased the number of its authorized common shares from 14.59 million to 952.09 million and lowered its par value from P100 per share to P1 per share.
The stockholders of NOW Corp. approved in June 2021 the increase of the company’s stake in NOW Tel for a total of P600 million which were part of the proceeds from the placement received from the equity subscription of Velarde Inc. to NOW Corp.
The additional subscription from NOW Corp. and other shareholders supported the increase in authorized capital stock of NOW Tel.
The SEC also certified the approval of the equity restructuring to fully wipe out NOW Tel’s deficit as of Dec. 31, 2020.
It said the quasi-reorganization allowed NOW Tel to eliminate its deficit which would allow it to declare dividends to shareholders from unrestricted retained earnings that may be generated subsequent to the quasi-reorganization.
PresidentRodrigo Duterte signed into law Republic Act. No. 10972 on Feb. 22, 2018 which extended NOW Tel’s franchise for another 25 years or until 2043.
NOW Tel scored another win as it received a favorable ruling from the Anti-Red Tape Authority in March 2022.
ARTA reiterated its earlier resolution declaring the completeness of NOW Tel’s application and its order to assign the spectrum ranging from 1970Mhz-1980Mhz paired with 2160Mhz to 2170Mhz and 3.6Ghz and to 3.8Ghz, including 5G frequencies for mobile and fixed wireless.