PLDT drops bid to acquire Sky Cable

MANILA, Philippines — PLDT Inc. dropped its plan to acquire ABS-CBN’s Sky Cable Corp. to avoid potential risks that may arise should the deal push through.

“We have withdrawn from the bidding process, at least as we understand it, for Sky Cable,” PLDT chairman and CEO Manuel V. Pangilinan said.

“I think the main reason, based on our review of the Bayanihan 2 Act, the Philippine Competition Commission has the ability to review mergers and acquisition and possibly reverse agreements which may have been struck in the course of that first year. Of course we’re concerned that that risk may arise. The risk is there and the prospect of divestment might be real, so we decided not to attract that risk,” he said.

Pangilinan said PLDT at first was not interested upon learning that Sky Cable may be for sale because the company knew the PCC may not approve the deal.

“We were encouraged when the Bayanihan 2 Act was passed, so we put an offer to ABS-CBN. But then, further review of the Bayanihan 2 Act by ourselves and by our legal counsel, showed the risk of possible divestment by us on review starting on the second year of the Act. So that’s really the main reason. Beyond that, there’s no other reason,” he said.

Under Bayanihan 2, mergers and acquisitions with transaction value lower than P50 billion and entered into within two years from effectivity of the law are exempt from compulsory notification with the PCC.

It also suspends the PCC’s exercise of motu proprio review of these transactions for one year.

Mergers and acquisitions with a transaction value of at least P50 billion or those entered into before the Bayanihan 2 took effect and exceeding the applicable thresholds still have to notify the anti-trust body.

Sky Cable offers cable services through Sky Cable and unlimited fiber internet through SkyFiber.

It also previously offered SkyDirect, a direct-to-home satellite service with 1.5 million subscribers, but the service was suspended on June 30 upon order of the National Telecommunications Commission.

The MVP Group, for its part, is in the business of direct-to-home satellite television service through Cignal TV.

Cignal TV, a subsidiary of the PLDT Group’s media and content arm MediaQuest Holdings, is the biggest and fastest-growing pay TV company in the country.