MANILA - Smart Communications, one of Philippine Long Distance Telephone Co's, mobile phone units, has offered to buy the rest of Pilipino Telephone Corp's (Piltel) shares for 8.50 pesos a piece.

Smart, which currently owns 92.8 percent of Piltel, had set a tender offer price of 8.50 pesos per share for 839,979,054 shares in Piltel, representing a 5 percent premium from Friday's closing price of 8.10 pesos, Piltel said in a statement at the weekend.

"Smart's tender offer is intended to provide an exit opportunity for Piltel's minority shareholders, given the change in Piltel's business direction," Piltel said.

Based on Reuters calculations, Smart may need to set aside around 7.1 billion pesos ($147 million) to acquire the remaining 7.2 percent stake in Piltel.

The tender offer will start on July 1 and would end at noon on July 29.

Piltel plans to sell and transfer its cellular assets and subscriber base to Smart. Once the transaction is completed, Piltel will become a holding company with its 20 percent stake in power retailer Manila Electric Co (Meralco) as its major asset, the company said.

Piltel will soon complete its purchase of a 20 percent stake in the country's largest power distributor.

At the end of December, Piltel had a cellular subscriber base of over 14.3 million, its company website showed.

Shares in Piltel closed up 1.25 percent on Friday. The Philippines' main index was down 1.48 percent.