MANILA, Philippines — ABS-CBN Corporation under the Lopez family and TV5 Network Inc. under Manuel V. Pangilinan signed an investment deal on Thursday that is expected to improve TV5’s presence in the broadcast industry and provide a permanent free TV venue for ABS-CBN’s programs.
In a disclosure to the local stock exchange, ABS-CBN announced its intention to purchase 6.46 million new common shares in TV5 for P2.16 billion. This amounts to 34.98% of TV5’s outstanding capital stock.
TV5 would issue convertible notes to ABS-CBN for P1.84 billion as part of the deal, which is expected to finalize this month. It will allow ABS-CBN to increase its ownership in TV5 to 49.92% after eight years from the date of issuance, which is now under pending regulatory approvals.
“This transaction is clearly transformational for both companies and is envisaged to significantly enhance TV5’s capability to deliver content and coverage to the Filipino public in the areas of entertainment, news, sports and public services.”ABS-CBN CORPORATION
After having its renewal application rejected by a House of Representatives controlled by allies of former President Rodrigo Duterte in 2020, the ABS-CBN network has been operating without a free TV franchise through their online and cable platforms.
ABS-CBN entered a block time leasing agreement with TV5 in January of 2021, allowing the network’s popular programs to air on the Kapatid channel.
“We welcome the entry and investment of ABS-CBN in TV5, as ABS-CBN has always been the leading developer and provider of Filipino-related entertainment content not only in the Philippines but overseas as well.”Manuel V. Pangilinan
“For ABS, it presents a fantastic platform for us to achieve synergies in production content and talent management as well as maximizing our content delivery,” ABS-CBN chair Mark Lopez said.
“Partnership is consistent with the strategic intention of ABS-CBN to evolve into a storytelling company whose goal is to reach as wide an audience as possible,” ABS-CBN president and CEO Carlo Katigbak cited.
The National Telecommunications Commission (NTC), however, said on Thursday that the agency was “monitoring developments” of the partnership.
NTC Commissioner Gamaliel Cordoba brought up the necessity to investigate the alleged violations of ABS-CBN that were highlighted during its franchise renewal hearing in 2020, such as tax payments and foreign ownership that ABS-CBN had previously denied.
“The NTC has issued a memorandum order that a franchise grantee shall not enter into commercial agreements in which the NTC has jurisdiction, with those that have outstanding obligations to the national and local governments.”NTC Commissioner Gamaliel Cordoba
TV5’s Cignal Cable Corp. also struck an agreement to invest in the Lopez Group’s Sky Cable Corp., which is anticipated to increase the latter’s coverage. Cignal agreed with Sky Vision Corp ABS-CBN Corp. and Lopez Inc. to buy a 38.88% share in Sky Cable for P2.86 billion as part of the cable TV acquisition.
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