Attractive discount, growth outlook draw investors to Globe SRO

GLOBE Telecom, Inc., which recently raised P17 billion from an oversubscribed stock rights offering (SRO), benefited primarily from its attractive discount and growth prospects, according to analysts.

On Friday last week, the company listed 10,119,047 common shares newly issued to shareholders who participated in its recently concluded rights offering on the Philippine Stock Exchange.

The common shares were sold in the offer at P1,680 per share for a 22.6% discount, “raising gross proceeds of approximately P17 billion,” Globe said in an e-mailed statement.

“The offer was oversubscribed, and all the offer shares were fully allocated to existing shareholders,” it noted, adding that “proceeds from the offer will be used to partly fund capex (capital expenditure) and pay the company’s short-term debt obligations.”

Globe intends to further expand its digital ecosystem and differentiate itself in the market as it capitalizes on opportunities in and beyond telecommunications.

Sought for comment, Regina Capital Development Corp. Equity Analyst Anna Corenne M. Agravio said: “The interest of the public was piqued by the attractive discount offered by the SRO price from the Globe’s price during the announcement and even its current market price.”

“Hence, a very inviting opportunity to average down,” she said in a phone message on Friday.

For his part, First Grade Finance, Inc. Managing Director Astro C. del Castillo said: “I’m not surprised if it’s oversubscribed. Number one, Globe has a good track record in the investment community.”

“It was attractive given such an offer and prospects of the company itself. Many investors want to equip themselves with strong cards,” he said in a phone interview.

“Globe’s aggressiveness in the digital world remains, and it continues to be one of the leading digital providers not only in telco but also in other related services,” he added.

Globe President and Chief Executive Officer Ernest Cu said the support “reflects trust in the capability of Globe to execute our core business and digital service platform initiatives.”

“We believe that this offer highlights Globe’s competitive differentiation in the market, further solidifies our healthy financials and enables us to pursue greater milestones while delivering industry-leading value to our shareholders,” said Globe Chief Finance Officer Rizza Maniego-Eala.

Globe Telecom shares closed 0.09% higher at P2,322 apiece on Friday. — Arjay L. Balinbin