Telstra have announced that although they had major plans with beer and food giant, San Miguel to build a new mobile network in the Philippines, this will no longer go ahead. Negotiations began August last year, where Telstra planned to take on local telcos by investing billions of dollars into the venture. Telstra chief executive, Andy Penn confirmed on Monday that both parties have ended negotiations for the $US1 billion joint venture.
He said in a statement, “Despite an enormous amount of effort and goodwill on all sides we were simply unable to come to commercial arrangements that would have enabled us to proceed.” “While this opportunity is strategically attractive… it was obviously crucial that commercial arrangements achieved the right risk-reward balance for all involved.”
The positive behind the failure of the joint venture is that it could help lift Telstra’s flagging share price but the negative is that it also questions Telstra’s ability to find new sources of profits with local operations facing falling profit margins. Partnering with San Miguel must not come easy after their last partner, Qatar Telecom, pulled out of a joint venture in 2015.
Negotiations have ceased for @Telstra and San Miguel Corporation on Philippines wireless joint venture https://t.co/tPQvpINeHY
— Telstra News (@Telstra_news) March 13, 2016
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