San Miguel and Telstra ended talks for further collaboration in providing internet connections in the Philippines, this is confirmed by both parties.
“The discontinuation of talks between Telstra and San Miguel will delay the entry of a formidable third telco into the Philippines’ market,” Fitch Ratings Inc. said in statement. This will support the credit strength of Philippine Telephone and Globe in the short term, Fitch said.
Though San Miguel is still looking for another opportunities in providing faster telecommunications but it is still far from reality. Some investors and people looking for faster connection are disappointed with the news and hope that there will be another company to come to the Philippines.
“Without Telstra, the perception in the market is that San Miguel’s telco venture will not be as great, since Telstra has the technical expertise,” said Rafael Palma Gil, Manila-based trader at Rizal Commercial Banking Corp, which has $1.72 billion in assets under management. “The announcement is definitely feeding the positive sentiment on PLDT and Globe. These stocks have underperformed in the past few months because of cloud over the industry by the threat of a third player entering the market.”
Globe recently proposed to the Philippine government to put additional satellites to boost network capacity and bandwith thus improve connection which is very timely before San Miguel and Telstra will have a headstart. Article here