"President Arroyo officially approved last week the conversion of the ELJ building into an IT zone. This building is PEZA-approved already," ABS-CBN chairman Eugenio "Gabby" Lopez III said in a talk with reporters Friday night.
With the approval, tenants will enjoy income tax breaks, duty-free imports of capital equipment and preferred income taxes.
Lopez said ABS-CBN just reached an agreement with RMH, a NASDAQ-listed, US-based call center company, for the lease of one-and-a-half floors of the 15-floor structure to be used as the latter’s base of operations in the Philippines.
Founded in 1983, RMH of Canada became a publicly-traded company on the NASDAQ in 1996, counting among its roster of clients some of the Fortune 500 companies.
Apart from RMH, ABS-CBN is in discussions with another call center firm which Lopez declined to identify.
ABS-CBN has earlier announced plans to lease out five to seven floors of the ELJ building to call center firms in a bid to diversify its revenue sources. Each floor has a size of between 2,000 to 3,000 square meters each.
The building’s first floor is already being occupied by some food and service establishments, with 10 tenants.
Meanwhile, Lopez said ABS-CBN expects to sign within the next two weeks a deal that would allow it to restructure its $3.6 million debt to BNP Paribas.
"We’d be signing with BNP in the next two weeks. We got their consent last month," Lopez said.
It would be recalled that BNP Paribas and Standard Chartered Bank thumbed down ABS-CBN’s offer last year of a P3- billion exchangeable notes facility for its debts. SCB has a loan exposure of P70 million.
The notes facility, secured by a mortgage trust indenture over most of ABS-CBN’s assets, is a major component of a master financial plan that seeks to restructure the company’s loans.
As for its loan to SCB, Lopez said the company is working on a more acceptable deal. "We’re trying to explore solutions. We want to be fair with the other creditors because they helped us so we can’t give them anything beyond what we gave other creditors," he said. In another development, ABS-CBN is looking at the possibility of selling locally-produced telenovelas and movies to China. "We are going to translate our movies and soaps and offer them to China. We hope to penetrate China this year,"ABS-CBN president Fredie Garcia said.
The company, according to Garcia, is already selling its programs in Indonesia, Malaysia and Kenya in Africa.
"We are tapping our library of local shows and movies as a new revenue stream for the company," Garcia said.
As for its international operations, ABS-CBN is gearing up for an aggressive expansion this year with the launch of its European operations in September.
ABS-CBN Global Inc. Ltd. has earmarked $3 million to $5 million in the next four years for its European operations. The company has so far invested $1 million. Just like in the US and Middle East, the ABS-CBN lineup will include The Filipino Channel (TFC), which shows top-rating programs; ABS-CBN News Channel (ANC); Cinema One, an all-movie channel; and Pinoy Central, the variety channel which has entertainment and sports features.
ABS-CBN expects its international operations to grow by 30 to 40 percent this year.
ABS Global has 148,000 subscribers worldwide. The company’s sales for 2002 grew by 36 percent to P1.911 billion.