The Lopez family are letting go of their broadband-cable business to PLDT of bilyonaryo Manny V. Pangilinan as a side deal in the marriage of their media networks, ABS-CBN Broadcasting and TV5.
The Lopezes agreed to sell up to 100 percent of SkyCable to PLDT’s Cignal Cable in a P7.5 billion deal signed on August 10.
In a regulatory filing, PLDT said Cignal would initially pay P2.862 billion for a 38.88 percent interest in SKyCable.
Cignal will also buy exchangeable debt instruments of SkyCable worth P4.388 billion which would allow PLDT to acquire the remaining 61.12 percent share of the Lopezes by 2030 or eight years from the issuance of the debt papers.
SkyCable will also issue P250 million convertible notes representing about 1.84 percent of the Lopez company’s outstanding capital stock.
Cignal, which will get financing from PLDT, is expected to benefit from Sky Cable’s existing customer base consisting of over 300,000 cable subscribers and close to 350,000 broadband subscribers as of the end of June.
Proceeds from the sale of shares, convertible notes and the issuance of the debt instrument, amounting to about P7.5 billion, will be used to repay certain obligations of ABS-CBN and Sky Vision and to fund the investment of ABS-CBN in TV5.
The Lopezes will use the proceeds of the sale of SkyCable to bankroll ABS-CBN’s buy-in into TV5.
Other proceeds will be used to expand Sky Cable’s coverage, offerings, and broadband.
PLDT said the deal is expected to be closed within the month, subject to certain closing conditions which include, full payment of the purchase price for the common shares, subscription to the debt instrument, and purchase of the convertible note.
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