The official said GMA’s planned IPO would have to wait until July this year as the network prepares its interim financial reports for submission to the Securities and Exchange Commission (SEC), a pre-requisite for companies intending to go public.
"We are definitely pushing through with the IPO. It’s just a matter of complying with the requirements of securities regulators," the company official said.
The company was earlier looking at a public listing in May.
GMA plans to offer between 20 to 30 percent of its stocks to the public. Last year, the network tried to undertake an IPO but misunderstandings between the three major groups of shareholders eventually led to the shelving of the IPO until 2006. At that time, the company expected to generate around P9 billion in proceeds from the maiden offering of its shares.
GMA recently formed a special purpose vehicle for the issuance of Philippine deposit receipts (PDRs) to allow foreigners to invest in a media enterprise whose ownership is constitutionally limited to Filipinos.
Based on a proposal submitted to the SEC, the new company will acquire existing shares currently owned by GMA’s major shareholders, and new shares to be issued by the network. The new company will then create and issue PDRs over the shares held by it. For as long as the PDRs are not exercised, the new company shall remain the owner of the shares underlying in the PDRs and shall retain and exercise full voting rights over such shares.
The sale of the PDRs will coincide with GMA’s IPO. Holders of the PDRs will enjoy only the economic benefits of the shares underlying the PDRs without voting and other ownership rights.
GMA said the PDRs will be a critical tool for generating international institutional investor interest in the network, achieving an optimal valuation and ensuring liquidity for the stock in the aftermarket. A similar approach has been successfully used by its main competitor ABS-CBN in their public shareholding structure.
The SEC is considering approving GMA’s proposal provided that the network allocate a sufficient number of underlying common shares which shall be distinct and separate from the common shares to be distributed within the country through an IPO.
GMA achieved its net income target last year of P2 billion, mainly driven by the strong performance of its international operations and the successful launch of its UHF channel. Revenues amounted to P9.4 billion, up 20.5 percent from the previous year’s P7.8 billion.
To ensure continued growth, GMA is now looking at Europe, Australia and Hong Kong as next sites for expansion. As of end-December last year, GMA Pinoy TV, the international channel of GMA, already had more than 57,000 subscribers.
Pinoy TV can now be seen in Japan, Guam and the United States, and the Middle East.
GMA has armarked P1 billion this year for the continued expansion of its regional operations and the establishment of two state-of-the-art studios to house more programs. It aims to broaden its presence nationwide as it gears towards dominating provincial programming after unanimously leading in TV viewership ratings across mega Manila.