Smart, as a utilities' company, is required by law to list after a certain number of years of operations for transparency purposes. Under the terms of Smart's licence for digital services, it is supposed to go public by 2008 or 2009.
Industry sources said the planned public offering was timely, since the mobile company was starting to show profitability. The planned public offering was likewise expected to push up PLDT's share price.
Smart generated net earnings of Ps52 million ($1.07 billion) and Ps31 million last August and July respectively. The company reported a subscriber base of 2.3 million, including analog cellular users and that of sister firm Pilipino Telephone Corp.'s Talk 'N' Text.
Subscriber acquisition costs have likewise fallen from a high of Ps4,000 to an average of over Ps1,000 which, by industry standards, is acceptable.
The company is in the process of choosing an underwriter for the plan. Prospective investment banks are conducting "research" to win the Smart deal. Initial figures given by the investment banks place Smart's value at between Ps95 billion and Ps130 billion.
If Smart goes public, the firm will be the only listed company which has cellular operations as its main business.
Listed company Globe Telecom, aside from its mobile business, is also a landline operator by virtue of the Executive Order 109.
Under EO 109, (the law liberalizing telecommunications), cellular and international gateway operators are mandated to put up 400,000 and 300,000 telephone lines, respectively. Firms which have licences for both are required to put up 700,000 lines.
Globe Telecom, with both licences, installed 700,000 in its service areas. Smart was likewise required to put up landlines, however, this was transferred to PLDT when it made the acquisition.
Globe has only 130,000 landline subscribers out of the more than 700,000 lines installed.
(PNA)
