PLDT Inc.’s highly anticipated acquisition of ABS-CBN Corp.’s Sky Cable has been called off, with both companies announcing the decision on Thursday. The deal, valued at P6.75 billion, was the latest attempt by businessman Manuel Pangilinan to acquire the Lopez-owned cable business and was expected to be completed next month.
Competition authorities had cleared the transaction in January, and Sky Cable subscribers had already been notified of the impending end of cable TV services on February 26. However, no explanation was provided for the sudden change of plans. In separate disclosures, PLDT and ABS-CBN simply stated that they had “mutually decided not to proceed with the sale of Sky Cable to PLDT under the Sale and Purchase Agreement signed by and among the parties in March 2023.”
ABS-CBN assured its customers that Sky Cable’s cable TV services would continue as usual and that its internet broadband service, SKYFiber, would remain unaffected. The deal was expected to expand PLDT’s broadband reach and enable ABS-CBN to streamline its operations and settle debts.
When the planned sale was announced in March 2023, PLDT emphasized that the transaction aligned with its mission to bridge the digital divide by expanding broadband connectivity and supported the government’s efforts to enhance the nation’s digital infrastructure. ABS-CBN, on the other hand, stated that the decision to sell was a strategic one, driven by the significant capital expenditure requirements of Sky Cable to maintain its competitiveness.
The proceeds from the sale would have also allowed Sky Cable shareholder SkyVision to settle its debts to ABS-CBN, which the broadcast firm intended to use to address retirement obligations and focus resources on content creation.
The news of the deal falling through caught many in the market off guard, according to China Bank Capital Corp. Managing Director Juan Paolo Colet. He called on ABS-CBN to promptly explain the situation to shareholders and outline its plans for Sky Cable moving forward. Colet also highlighted the importance of clarifying how the company intends to manage its debt load, considering that the deal was expected to pay off loans.
This is not the first time Pangilinan has attempted to acquire Sky Cable. In 2020, he abandoned a bid due to competition concerns but revived the offer in 2022, which also involved ABS-CBN taking a stake in TV5. However, political pressures, stemming from ABS-CBN’s franchise loss two years earlier in a dispute with then-president Rodrigo Duterte, ultimately led both parties to decide against proceeding with the transaction.
The announcement of the deal’s cancellation did not significantly impact PLDT’s share price, which rose by 0.78 percent to P1,298. Conversely, ABS-CBN’s shares fell by 3.02 percent to P4.17 apiece. The benchmark Philippine Stock Exchange index ended the day with minimal movement, rising by just 0.08 percent.
While the reasons behind the termination of the PLDT-ABS-CBN deal remain undisclosed, the decision has undoubtedly left both companies and their stakeholders with questions about the future of Sky Cable and the strategies they will employ to navigate the changing media landscape. Only time will tell how this development will shape the telecommunications and broadcasting industries in the Philippines.
Source: The Manila Times
