GMA Network postpones IPO

GMA Network announced yesterday that it has indefinitely postponed its planned initial public offering (IPO) this year until certain issues between the majority and minority shareholders are satisfactorily resolved.

Officials said the network will try to work out a solution that will be in the best interest of the company. Majority owners of the network include the Jimenezes and Duavits who own 35 percent each and the Gozons which account for the balance.

It was learned that three groups, namely the Jimenez, Duavits and Gozon groups could not agree as to how much of their individual shareholdings they are going to give up as well as the timing and pricing of the planned IPO.

The disagreement is between the Gozons and Duavits on one side, which account for around 65 percent of total shareholding and the Jimenezes on the other side. Currently Felipe Gozon is the CEO and president of GMA Networks while Jimmy Duavit is the EVP and COO. The Jimenezes who used to control management of the company are now just represented in the board.

GMA has implemented its planned expansion projects that include the launching of its International Channel in the US and other territories, the upgrading of its transmitter and other facilities in key cities in the provinces, and the preparations in line with its co-production and/or blocktime agreement with Channel 11.

The company has also completed its P180.2-million state-of-the-art broadcast automation systems (BAS) project last January that will service both local and international broadcast requirements of GMA network.

In addition, GMA 7 said it will build two state-of-the-art studios within its compound that will house more programs including huge variety shows.

The company said the majority owners of the network wanted to give the public the chance to become shareholders of a company which engages in public service, through the IPO, without losing management control of the company.

Meanwhile, government can raise about P4.4 billion from the sale of its stake in International Broadcasting Corp. (IBC 13) and Radio Philippines Network (RPN 9) to private investors this year.

Catanduanes Rep. Joseph Santiago, former chief of the National Telecommunications Commission (NTC), noted that while the expected proceeds from the sale are mere one-time and non-recurring gains, the extra income would nonetheless be most welcome at this difficult time when government is on the verge of a financial crisis.

"More importantly, by disposing of the two broadcasting networks, government will be getting rid of non-performing assets that could possibly cost taxpayers more money later on," Santiago pointed out.

He added that besides, government should get out and stay out of businesses that are best left to the private sector.

The P4.4 billion that government expects to earn from the sale of IBC 13 and RPN 9 account for about 25 percent of the aggregate P18-billion income the national treasury hopes to generate this year from the privatization of selected state assets.

IBC is said to be worth P3.2 billion while government’s 72.4-percent stake is RPN 9 is valued at P1.3 billion.

Other government assets lined up for auction this year are real estate worth a total of P14.2 billion and shares of stocks in publicly listed companies worth around P118 million.