Foreign investors eye government’s stake in RPN-9, IBC-13

Foreign investors have expressed interest in acquiring government’s stake in television networks Radio Philippine Network Inc. (RPN-9) and Intercontinental Broadcasting Corp. (IBC-13).

Government sources told The STAR that CLSA Exchange Capital, financial advisor for the privatization of the two government TV networks, is in talks with both foreign and local investors who plan to take part in the bidding scheduled for the second quarter of this year. 

While the Constitution requires that the ownership and management of mass media shall be limited to citizens of the Philippines, or to corporations, cooperatives or associations, wholly owned and managed by Filipino citizens, the sources said these foreign investors will find a way to invest if they really want to.

CLSA is now on the second phase (preparation of the terms of reference for the bidding) of the implementation of the privatization plan for the two TV stations as approved by the Privatization Council.

Among those who earlier expressed interest to acquire RPN-9 include businessman Manuel Pangilinan of the Philippine Long Distance Telephone Co.(PLDT), Solar Sports of businessman Wilson Tieng, and El Shaddai leader Mike Velarde. 

Pangilinan earlier said that investing in the broadcasting business is definitely one area that the PLDT group is seriously contemplating,.

CLSA has yet to finalize the valuation for the two TV stations. The last appraised value made many years back was P1.3 billion for RPN- 9 and P3.5 billion for IBC -13.

RPN-9 operates six TV stations in six cities, TV relay and translator stations in Baguio City, Visayas and Mindanao, and 13 radio stations all over the country. Government’s interests in RPN 9 include equity, plus the license to operate a free TV station, physical assets and receivables.

What will be sold are selected assets of RPN-9 and IBC-13, particularly the franchise, infrastructure, and stations. 

Jose AR Bengzon III, chief privatization officer of the Privatization Management Office (PMO), told The STAR that it is possible that nothing will remain from the proceeds of the sale because of amounts still owed to several parties, including various creditors (both secured and unsecured), the Bureau of Internal Revenue, and the employees.

Bengzon said the most important concern rights now is to stop the bleeding of these TV stations. "Government is not hoping to make money out of this exercise. The proceeds may not even be enough to settle all the obligations, including those pertaining to unpaid taxes to government. Government just wants to get out of the business. Anyway, it still has Channel 4," he said.

CLSA is now in talks with potential investors as well as the various government agencies and shareholders to ensure a smooth implementation of the privatization plan as approved by the Privatization Council. "If ever there will be a stumbling block to the sale, it is the cooperation of the different stakeholders," he pointed out.