Sky, Home shareholders fight over Beyond Cable

The owners of Sky Cable and Home Cable are engaged in a boardroom battle for control of the country’s two biggest cable television companies, now merged under the holding firm Beyond Cable, The STAR has learned.

Philippine Long Distance Telephone Co. (PLDT) president and CEO Manuel Pangilinan was able to convince Echostar, one of the largest direct-to-home (DTH) satellite television companies in the US, to infuse $30 million into Beyond Cable. Pangilinan was also proposing that PLDT subsidiary Mabuhay Satellite invest in Beyond in terms of its transponders to allow Sky and Home to migrate to satellite transmission.

The proposed deal, however was rejected by Sky Cable since Echostar and Mabuhay’s investments will allow PLDT to wrest control of Beyond Cable from the Lopez group which owns Sky.

Because of SkyCable’s rejection of Echostar’s offer, highly placed sources told The STAR that the US DTH giant is now in talks with Dream Broadcasting Corp., a local DTH company owned by businessman Antonio O. Cojuangco who just recently bought Associated Broadcasting Corp. (ABC 5).

Echostar wanted a partnership with PLDT because the rental of transponders accounts for a sizeable portion of the cost of a satellite tv business. With Mabuhay in the picture, there will be no expenses for transponder rentals.

Dream Broadcasting is currently leasing its transponders. The source said it is highly possible that Pangilinan, who wanted early on to embark on the DTH business, would end up being in partnership with Echostar and Dream Broadcasting by putting in Mabuhay’s transponders as investment. "This way, PLDT will be both in the cable and satellite tv businesses," the source said.

It will be recalled that just recently, SkyCable and Home Cable signed a memorandum of agreement with their creditors committing to put in $30 million within 60 days or before yearend to jumpstart the restructuring of around P2.5 billion in combined debts. ABS-CBN Broadcasting Corp., which is currently arranging a $90 million syndicated loan for its own needs, will put in $30 million of this into Beyond.

Considering that the loan is convertible into equity, the ABS-CBN loan will drastically reduce PLDT-owned Home Cable’s holdings in Beyond. At present, Beyond is 67 percent owned by Sky and 33 percent by Home.

The $30 million will be used partly to update interest payments to the creditor banks of Sky and Home and to acquire addressable set-up boxes that will eliminate cable tv piracy.