ABS-CBN, TV5 pause investment talk to clear issues with regulators

MANILA, Philippines — Media giant ABS-CBN Corp. has hit a roadblock in its plan to return to free TV, as its investment talks with Pangilinan-led TV5 Network Inc. had to be paused to give way to regulatory checks.

ABS-CBN yesterday informed the Philippine Stock Exchange that its minority investment in TV5 will have to wait for now, as the two networks look to respond first to the issues raised by certain lawmakers and the National Telecommunications Commission (NTC).

“To address the issues which have been raised by certain legislators and NTC on the proposed investment by ABS-CBN for a minority interest in TV5, ABS-CBN and TV5 have agreed to pause their closing preparations,” ABS-CBN said.

However, Infrawatch PH convenor Terry Ridon said there is no need for either Congress or regulators to assess the legality of the transaction between ABS-CBN and TV5.

Ridon, a former member of the House committee on legislative franchise, said the partnership can proceed even without the approval of Congress.

Ridon pointed out that the P4 billion investment falls below the P50 billion threshold set by the Philippine Competition Commission. The PCC must be notified of any transaction between firms that reaches the ceiling, for its review.

“It is our position that the transaction breaches no NTC regulation, as ABS-CBN has more than adequately shown that it has no outstanding obligation in any agency of the government,” Ridon said in a text message to reporters.

Regina Capital head of sales Luis Limlingan said ABS-CBN and TV5 might also be figuring out how they can compete with GMA Network Inc., which has dominated the free-to-air platform during the two-year absence of ABS-CBN.

“Maybe both companies might be exploring other alternatives to bring quality programming to its viewers and also put themselves in a competitive space against GMA-7,” Limlingan said.

ABS-CBN and TV5, for their part, said their partnership will benefit free TV, a platform that remains the most affordable and extensive source of news and entertainment for millions of Filipinos. They vowed to address all regulatory concerns and make changes to the terms and conditions if necessary.

Under the deal, ABS-CBN purchased 34.99 percent of the capital stock of TV5 worth P2.16 billion and eyes to spend another P1.86 billion for a convertible note to be issued by TV5.

The NTC maintains that the minority investment to be made by ABS-CBN in TV5 should be cleared before the agency prior to consummation.

SAGIP party-list Rep. Rodante Marcoleta, who led the congressional crusade to deny ABS-CBN of its franchise renewal in 2020, also wants regulators, particularly the PCC and NTC, to review the transaction for possible violations.