Tonyboy bankrolls ABC-5 expansion

Businessman Antonio "Tonyboy" Cojuangco has advanced P600 million to Associated Broadcasting Co. (ABC-5) to bankroll its expansion and capital expenditures ahead of fresh capital infusion by the network’s shareholders.

Sources told reporters that Cojuangco, who bought ABC-5 for P5 billion last year, had already advanced P200 million to the network and another P400 million was expected to be advanced sometime in the first two weeks of February.

According to Raul de Mesa, one of Cojuangco’s partners in the acquisition of the network from former owner Edward Tan, the advances were being made because ABC-5 was in need of funds and it would take time to facilitate capital infusion by company shareholders.

De Mesa owns DM Archers, a holding company which owns 32 percent of ABC-5’s interests. He said that Cojuangco was infusing funds into the network but they were being booked as advances.

De Mesa said the funds had to come in as advances because Cojuangco "did not want to disturb the ownership structure" of the network while regulatory clearances are still being processed.

According to De Mesa, the three main shareholders of ABC 5 would eventually put in fresh capital to offset Cojuangco’s advances.

The advances were used to bankroll equipment upgrades and salary upgrades at ABC-5 as it renews its bid to compete with the two other large networks, GMA 7 and ABS-CBN.

Cojuangco acquired ABC-5 last year for a total price of P4.5 billion to P5 billion and the new owners took over the network this month with Cojuangco as chairman and chief executive officer.

It will be recalled that the Concepcions of the RFM Group and PLDT’s Manny Pangilinan earlier made a pitch for ABC-5 at a price of close to P2 billion, which was rejected by Tan.

Disagreement over pricing almost led to the collapse of the talks between Cojuangco and Tan but an agreement was ultimately reached to effect the sale.

Still cash-rich from the sale of his interests in Philippine Long Distance Co. (PLDT), Cojuangco also owned Dream Broadcasting Corp., a satellite broadcasting outfit. ABC-5 has around 15 stations and more than 100 cable TV affiliates nationwide.

ABC-5 is computed to have an enterprise value of P2 billion, with the company having around P1.2 billion in debts and P800 million in land assets.