MVP 'hopes' to acquire GMA 7 by year-end

By Lenie Lectura, BusinessMirror

Posted at Jul 13 2012 07:31 AM | Updated as of Jul 13 2012 10:56 PM

MANILA, Philippines - Manuel V. Pangilinan, chairman of Philippine Long Distance Telephone Co. (PLDT), said on Thursday he hopes to close an “investment deal” with the owners of GMA Network Inc. before the end of the year.

But he added: “It is still under discussion with the groups of Gozon, Jimenez and Duavit. That timetable is beyond our control. That’s we would like to see [end of the year closure] but it’s beyond our control because we have to go through both houses of Congress and subject to the approval of the National Telecommunication Corp.,” he said.

He also said the PLDT group will tap banks to partly finance the planned acquisition of GMA Network Inc.

“None yet, we are talking to our bankers,” Pangilinan said when asked if there were other assets to dispose of to fund his group’s investment in the broadcasting firm.

ePLDT, a unit of PLDT, has sold its entire 27 percent stake in online-gaming firm PhilWeb Corp. for P4.25 billion.

PLDT President Napoleon Nazareno said the sale is part of the group’s asset repositioning for more efficient funding of future capital expenditure and investments.

Pangilinan said he couldn’t yet disclose which banks would be tapped to help the PLDT group fund the reported P53-billion tag price, which both parties have initially agreed on.

“We would like to put it more in cash… We are preparing for that in the event it materializes,” said Pangilinan when asked how much will be borrowed from banks as he earlier said that his group will be paying GMA major shareholders in cash.

Pangilinan also said that if and when the deal is sealed, the investment would be made either through PLDT or MediaQuest Holdings Inc., the media holding company of the PLDT Beneficial Trust Fund, which made an attempt to buy 66.67 percent of GMA 7 for P8.5 billion many years ago. However, negotiations bogged down after MediaQuest reduced its valuation of GMA to about P12 billion from P14.58 billion.

“It maybe a yes or no. I think that PLDT could pick up the PDRs [Philippine depository receipts],” Pangilinan said when asked if the investment will be made via MediaQuest.

In May, PLDT, through wholly owned subsidiary ePLDT, announced it was investing P6 billion in the form of PDRs in MediaQuest to sustain the growth momentum of TV5 and Cignal TV.

Nazareno said many other telecommunication companies worldwide have made similar investments in media assets. He pointed out that PLDT’s financial investment in media is consistent with its overall strategy of evolving itself from a traditional telco into a multimedia service company.

“Pldt has a choice of strategically as staying as a telco highway providing access. As you know technology on the access side of telcos are also changing drastically. At the same time, the layer above us which belongs to the internet, social media dominated by the facebook, google, among others is something we perceived to be a threat in the long term. So, we thought of getting into the content production layer and integrate the highway with content production,” said Pangilinan when asked of the value of its future investment in GMA 7 despite already having TV5 on board.