ABS-CBN plans P10-B bond issue

MANILA, Philippines - Multimedia giant ABS-CBN Corp. is raising as much as P10 billion next year from the issuance of retail corporate bonds to bankroll its capital expenditures including its venture into the telecommunications business as well as the country’s shift to digital television.

ABS-CBN assistant corporate secretary Enrique Quiason said the company’s Board of Directors authorized the offering and issuance in 2014 of retail corporate bonds in the principal amount of up to P10 billion.

Quiason informed the Philippine Stock Exchange (PSE) that the fund raising activity would initially involve P5 billion worth of retail corporate bonds with an option to raise an additional principal amount of up to P5 billion.

 â€œThe Board authorized the registration of such bonds under the Securities Regulation Code,” he said.

The company is still in the process of finalizing its capital expenditures for next year but it would likely be within the vicinity of P5 billion which is the amount it allocated for various projects this year.

The capital expenditures of ABS-CBN including equipment replacement, transmission facilities, film and program rights acquisition, among others fell 20 percent to P2.81 billion in the first nine months of the year from P3.5 billion in the same period last year.

ABS-CBN through ABS-CBN Convergence has tied up with Ayala-led Globe Telecom Inc. last May to launch ABS-CBNmobile as a third player in the competitive telecommunications industry dominated by rivals Philippine Long Distance Telephone Co. (PLDT) and Globe.

Last Nov. 19, ABS-CBNmobile was launched after the company gave away 100,000 subscribers identification module (SIM) cards to survivors of Super Typhoon Yolanda to help them communicate with family and friends. It also made available another 100,000 SIM cards to sell in Metro Manila and other areas not affected by the typhoon to enable the sharing of load with the survivors.

ABS-CBN is spending as much as P3 billion to acquire communications equipment and for working capital while utilizing the network of Globe nationwide. Under the partnership, ABS-CBN would buy capacity from Globe on a wholesale basis as part of the network sharing agreement to deliver its content and to offer traditional telecoms services such as voice and SMS services on mobile devices.

This is not the first time that ABS-CBN has ventured into new media territory in order to deliver its programs and other content to its viewers as it launched video-streaming site TFC.tv in 2000 and the recently launched free video streaming website iWanTV!.

Likewise, the company is preparing for the impending shift to digital TV from analog come 2015 as the National Telecommunications Commission (NTC) is now finalizing the implementing rules and regulations after it issued a memorandum circular for “Standard for Digital Terrestrial Television (DTT) Broadcast Service”.

ABS-CBN is reportedly spending P2 billion for the planned adoption of Japan’s Integrated Service Digital Broadcasting-Terrestrial or ISDB-T standard.