MANILA – (UPDATE) Philippine Long Distance Telephone Co. and Globe Telecom Inc. said Monday they were acquiring the telecommunication business of San Miguel Corp., which had backed out of its bid to challenge the industry duopoly.

The two telecom giants said they would jointly roll out San Miguel's assets after each acquiring a 50-percent stake in the business worth P70 billion.

They will also return enough frequencies to the government to make way for a possible third player. San Miguel's bid to challenge PLDT and Globe's dominance ended after its talks with Australian telecom giant Telstra fizzled earlier this year.

"We take over the (San Miguel) companies, we have to take care of operating them and generate plans on how the companies will be integrated to our operations," Globe President Ernest Cu told reporters.

The sale was a "mutual agreement" with San Miguel, PLDT President Manuel Pangilinan said in a separate briefing.

“I guess they (San Miguel) decided to divest out of the telco business. On our part, we are quite keen to acquire additional spectrum," Pangilinan said, adding access to San Miguel's 700Mhz frequency would enable its mobile unit, Smart Communications to offer faster connections.

Stronger, wider internet helps our people w/ more access to info and the wealth of opportunities connectivity brings. That's our commitment.

— Manny V. Pangilinan (@iamMVP) May 30, 2016

"Moving forward, we expect to fully recover what we have invested over the past six years building our network. But more importantly, the public should expect to get faster, affordable Internet access very soon with this deal," San Miguel President Ramon Ang said.

Internet speed in the Philippines is the second slowest in Asia, next only to war-torn Afghanistan. It is also among the most expensive. Consumer groups have blamed this on a lack of competition.

Incoming president Rodrigo Duterte said last week he would spur competition in the telecommunications industry to improve services and bring down prices.

PLDT and Globe said they would acquire Vega Telecom Inc., which owns controlling interests in Bell Telecommunication Philippines Inc., Eastern Telecommunications Philippines Inc., Cobaltpoint Telecommunication Inc., Tori Spectrum Telecommunication Inc., and Hi-Frequency Telecommunication, Inc.

In addition, PLDT said it would acquire a 50-percent stake in New Century Telecoms Inc. and eTelco Inc.

Globe said it would acquire 50 percent of Bow Arken Holdings Company Inc and Brightshare Holdings Corp.

The acquisition cost includes P17 billion in debt, the companies said.

A notice on the planned acquisition has been filed with the Philippine Competition Commission (PCC), PLDT regulatory affairs head Ray Espinosa said.

Espinosa said the deal would not require approval from Congress, which grants franchises to telecom firms under Philippine law.

“We are not acquiring the operating vehicle. We are acquiring the parent companies,” he said.

PLDT and Globe have long battled for dominance in the Philippine telecommunications industry, gobbling up the competition along the way.

In 2011, PLDT completed a P69.2-billion acquisition of a majority stake in Sun Cellular, which attempted to break the duopoly with aggressively low-priced offerings. Last year, Globe took a controlling stake in Bayan Telecommunications.