Huge downpayment, regulatory approvals scuttle GMA-PLDT deal

MANILA, Philippines - GMA Network reportedly demanded billions of pesos paid once a memorandum of understanding (MOU) is signed with the group of Manuel V. Pangilinan, whether or not the latter’s bid to acquire the private stake in the broadcasting company pushes through.

This, as well as other non-monetary demands, led Pangilinan’s group to no longer pursue its quest to purchase the over 70 percent stake held by the Gozon, Jimenez, and Duavit families in GMA, The STAR learned.

Sources revealed that the billions of pesos in fees, which is on top of the reportedly over P50 billion purchase price, was to paid after the MOA is signed and before the closure of the deal. Other requirements prior to closure include securing all the necessary government and regulatory licenses and approvals, all to be secured by the PLDT Group.

Without GMA help, securing the necessary licenses and approvals will not be easy, a source said.

It was not immediately known why the owners of GMA wanted the inclusion of the provision on the “fee” in the discussions when during the Pangilinan’s group’s first attempt to takeover GMA, there was no such demand.

Sources privy to the recently failed negotiations revealed that Pangilinan’s group felt that the owners of GMA were just not interested to sell. “This was not something an interested seller would ask for,” a highly placed source said.

When the two parties jointly announced early last month that the discussions are no longer pushing through, they said that it was not about the purchase price.

The acquisition of GMA by PLDT Beneficial Trust Fund unit Mediaquest was supposed to be part of Pangilinan’s aim for the Philippine Long Distance Telephone Co. (PLDT) to transform into a multi-media company. The group owns minority stakes in The Philippine STAR, Philippine Daily Inquirer and Business World, and controlling interests in TV5 and Cignal, a direct-to-home (DTH) satellite company.

The acquisition of GMA, STAR sources revealed, augurs well with plans of Hong Kong-based First Pacific Co., which controls PLDT, to have a regional presence in the broadcasting field.

Pangilinan earlier said he is in talks with Anthoni Salim, chairman and controlling shareholder of First Pacific, to acquire Salim’s Indonesia-based TV station.

It was also learned that First Pacific is also eyeing a TV network in Vietnam.

In 2001, PLDT engaged in talks with the owners of GMA, but negotiations bogged down over issues encountered by the prospective buyer.

“2001, if I recall correctly was P14 billion (amount being offered for GMA). It’s just that Home Cable came ahead of GMA by a few months. In 2001 and 2002, PLDT was not in good shape. If GMA came in first, I think we would have chosen GMA. But that’s fate,” Pangilinan earlier said.