MVP purchase of GMA-7 almost a done deal

MANILA, Philippines - The group of telecommunications magnate Manuel V. Pangilinan’s acquisition of GMA Network Inc. is almost a done deal with the likelihood of taking in one or two investors to pick up a small minority stake in the broadcast firm, sources said.

Sources privy to the negotiations said financing for the purchase of GMA-7 is already in place and all that remains is some paperwork to finalize a deal with the Gozon, Duavit and Jimenez families, who own a controlling stake in the television network.

“It’s just a matter of time. Just the final paper work. Financing in place. Also possible that another person or two will come in for a small minority,” the source said.

Pangilinan told reporters last week that his group was willing to acquire GMA-7 at a price higher than the nework’s market capitalization, which stood at P33.95 billion as of Friday.

Sources said the three major owners of GMA-7, which collectively own 77 percent of the network, were willing to divest their stake for P55 billion to P60 billion.

Pangilinan said his group would pay in cash and that loans would only fund a small portion of the transaction.

He could not give a timetable for the acquisition, saying the proposed deal is subject to a lot of factors, which include approval of both the Congress and the National Telecommunications Commission.

Pangilinan, however, is hoping the deal can be finalized within the year.

He said Mediaquest, a unit of the Beneneficial Tust Fund of PLDT that also holds the group’s media assets such as a majority stake in Associated Broadcasting Co. or TV5 as well minority assets in several newspapers, would likely be the vehicle to be used in taking over GMA-7.

The acquisition of media assets is vital to the PLDT group’s goal of transforming into a multimedia and technology conglomerate as telecommunications companies across the global face intense competition from the so-called “over the top players like Facebook and Skype.

PLDT came close to buying a controlling stake in GMA in 2001. Talks, however, fizzled out down due to valuation issues.

The acquisition of GMA would catapult Pangilinan’s group to the number one position and would result to a virtual duopoly in the TV industry.

The PLDT Group, through TV5, is a far third in the broadcast market, currently dominated by rival networks ABS-CBN and GMA which account for more than 60 percent of audience share in the Philippines.