ABS-CBN Corp. – controlled by tycoon Oscar Lopez – agreed to buy a stake in rival TV network TV5 as the company, which once dominated the Philippine media industry until the government forced it off the air two years ago, is looking to relaunch his business.
As part of the deal, ABS-CBN agreed to pay Mediaquest – a unit of Philippine telecommunications giant PLDT’s trust fund – 2.2 billion pesos ($39.5 million) to acquire the 35-year stake. % in TV5, according to a regulatory filing Thursday.
The deal comes two years after ABS-CBN lost its free-to-air franchise. The Philippine Congress began considering the company’s request to renew ABS-CBN’s franchise for another 25 years in December 2019, but had not made a decision by the time the license expired in May of the year. next. While ABS-CBN airs its shows through digital channels and some of its content is also aired through TV5, it remains in the red posting a net loss of 5.6 billion pesos in 2021.
ABS-CBN said it would also invest 1.8 billion pesos in convertible notes issued by TV5. Proceeds from the sale of shares and the issuance of tickets will be used by the free channel to fund capital expenditures and stimulate content offerings.
“This partnership is in line with ABS-CBN’s strategic intent to evolve into a storytelling company whose goal is to reach as wide an audience as possible,” said Carlo Katigbak, President and CEO. from ABS-CBN in a statement.
To partially fund the deal, ABS-CBN separately agreed to sell 39% of its SkyCable cable television unit to the MediaQuest unit Cignal Cable Corp. for 2.9 billion pesos, PLDT, the parent company of Mediaquest, said in a regulatory filing. At the same time, Cignal Cable will invest 4.4 billion pesos in a debt instrument that gives Cignal Cable an option to buy the rest of SkyCable after eight years.
ABS-CBN’s alliance with TV5 and its parent company PLDT, led by tycoon Manuel Pangilinan, comes as billionaire Manuel Villar prepares to launch his media company using former frequencies previously assigned to ABS-CBN. Villar’s advanced media streaming system aims to begin streaming this year, initially in Metro Manila.