Benpres director Eugenio Lopez III said that negotiations with a third party strategic investor will commence as soon as SkyCable merges with Home Cable, which is owned by the PLDT group.
Owners of the country’s two leading cable television companies signed the master consolidation agreement (MCA) last Wednesday that will pave the way for the consolidation of their respective cable assets and the merger of the two companies into a new holding company.
The new agreement follows the conclusion of the due diligence review undertaken by both parties since the signing of a preliminary agreement last April 3.
Under the agreement, the economic interest of Mediaquest and PLDT in Philippine Home Cable Holdings, Inc., which is held by Unilink, and the Lopez Group’s shares in Sky Vision Corp. will be consolidated into a new holding company, to be initially owned equally by the two groups.
Convertible instruments exchangeable into shares of the new holding company to be held by the Lopez Group for its shares in Sky Vision may be offered to a strategic partner and/or financial investors who are envisaged to provide added value to the new company.
The Lopez Group has a bigger share in the new holding company since SkyCable has a bigger value than Home Cable with the former having a much bigger market share and more assets.
The MCA was signed by Oscar M. Lopez, Manuel M. Lopez and Eugenio Lopez III for the Lopez Group which controls SkyCable via Sky Vision and Manuel V. Pangilinan for Philippine Long Distance Telephone Co. (PLDT) and Ignatius F. Yenko for MediaQuest.
Benpres Holdings Corp., the publicly listed flagship of the Lopez Group has interests in communications, utilities, basic infrastructure, property development, information technology and health care. Together with ABS-CBN, it controls approximately 75 percent of Sky Vision Corporation.
MediaQuest, on the other hand, is a 100-percent-owned subsidiary of the PLDT Beneficial Trust Fund. It controls Home Cable, Inc., through a wholly-owned subsidiary, Unilink Communications Corp. It also holds controlling interest in Nation Broadcasting Corp. (NBC) which operates a network of 30 radio stations and a UHF TV channel.
The consolidation is expected to spur the development of cable TV in the country, rationalize infrastructure development, lower programming costs and provide a wider range of programming choices for viewers. It will also make possible the introduction of new cable TV technology that will enable customers to enjoy richer content and a growing array of convergent services.
Central CATV, Inc. (Central) and Pilipino Cable Corp. (PCC), held for Benpres by Sky Vision Corp., offer cable TV services under the trade name SkyCable. Central’s franchise areas cover Metro Manila while those of PCC cover key cities and municipalities in Cebu, Iloilo, Baguio, General Santos, Tagum, Naga, Cavite, Ilocos region, Pangasinan and Bulacan.