Cignal Cable Corp. buys into SkyCable

MANILA, Philippines — Media magnate Manuel V. Pangilinan’s Cignal Cable Corp. has acquired a 38.88-percent stake in ABS-CBN’s SkyCable Corp. in a multibillion-peso deal seen to benefit 350,000 customers.

Cignal Cable, a subsidiary of MediaQuest Holdings Inc., yesterday announced that it signed a sale and purchase agreement with Sky Vision Corp., ABS-CBN Corp. and Lopez Inc. to obtain 38.88 percent of the issued and outstanding capital stock of SkyCable.

The P2.86-billion investment by Cignal Cable is expected to benefit the 300,000 cable users and 350,000 broadband subscribers of SkyCable as of June.

Cignal Cable will also spend P4.39 billion in a debt instrument to be issued by the Lopez Group. It will allow Cignal to expand its ownership of SkyCable to as much as 61.12 percent after eight years, subject to the necessary approval of regulators.

Cignal Cable will likewise obtain from SkyCable a P250-million convertible note, which can then be turned into primary common shares representing 1.84 percent in capital stock.

The Lopez Group plans to use the P7.5 billion in proceeds from the sale shares, debt instrument and convertible note to settle certain obligations of ABS-CBN, as well as finance its purchase of shares in TV5 Network Inc.

On the other hand, PLDT Inc., through subsidiary ePLDT, will extend the loan that Cignal Cable will use to complete its transaction with SkyCable.

The transaction is scheduled to be concluded this month, subject to the payment of purchase price, subscription of the debt instrument and issuance of convertible note.

With funding from Cignal Cable, SkyCable plans to improve its coverage, offerings and services in line with the government’s push for universal connectivity, particularly in far-flung areas.

Also, Cignal wants to widen the public service programs offered by SkyCable, including the operation of Knowledge Channel that airs educational shows and DepEd Channel, which offers long-distance learning to the Filipino youth. – Elijah Felice Rosales