MANILA, Philippines (UPDATED) – TV5 chair Manuel V. Pangilinan’s rumored plans to acquire GMA-7, which a news website initially reported, has stoked Filipinos’ curiosity and has become one of the Philippines’ Twitter trending topics on Tuesday, Dec 27, 2011.
Pangilinan supposedly made a “mind-boggling” and irresistible offer to acquire GMA-7, said the Philippine Entertainment Portal or PEP.ph in a news alert.
The deal is “two-thirds” done, the website said.“Meron pa raw kasing pamilya na hindi kumbinsido, o dili kaya’y nagho-hold out for a better deal,” said PEP.ph, referring to the three families that own GMA Network Inc. – the Gozons, Duavits, and Jimenezes. (One family is reportedly unconvinced, or is holding out for a better deal.)
“Pero sa lumulutang na figures, mukhang mahirap nang matapatan ang offer ni MVP,” PEP.ph explained, without stating the exact figures. (But based on the rumored figures, it seems that MVP’s offer is difficult to match.)
The reported deal, eventually placed at “P500 billion,” was denied by GMA Network.
“We would like to inform you and the public that there is no truth to the said report,” said GMA Network vice president for investor relations and compliance Ayahl Ari Augusto Chio told the stock exchange in a disclosure.
Ray Espinosa, president of ABC Development Corp, which runs TV5, also denied the reported talks. “That ‘news’ is not true,” he texted Rappler.com from abroad when asked about it.
“If that was possible, we would be open minded about it,” he added when asked if buying a new station is considered by the group.
As of 11:14 a.m., the keywords “GMA 7” and “MVP” were the Philippines’ eighth and ninth Twitter trending topics, respectively.
Gozon on joint ventures
The question-and-answer portions in this year’s Philippine Advertising Congress, however, could provide clues on the two broadcast giants’ long-term plans.
In his Q&A with ABS-CBN anchor Korina Sanchez, GMA Network chair and chief executive officer Felipe Gozon bared his views on joint ventures. “There has been a trend worldwide of TV and print media forming joint ventures,” Sanchez asked Gozon. “Do you think there is a future there? Why and how?”
“Our policy has been, there is nothing that we reject as long as it will result in a mutually beneficial result,” Gozon answered. The company chair, a lawyer, did not elaborate.
The network now has its own GMA News Online while PDI now has Inquirer.net.
MVP as ‘game-changer’
In the same advertising congress, Pangilinan responded to questions from GMA-7 anchor Mike Enriquez about funding TV5 to compete with GMA-7 and ABS-CBN. “How long do you keep infusing funds into (TV5),” Enriquez asked the man known as MVP – whom the anchor ribbed as “the Most Valuable Pangilinan” on Earth.
“I think the short answer, Mike, is that we will spend and invest in TV5 in the appropriate amounts. There will be prudential limits,” said Pangilinan, who recently inked a rumored P1-billion deal with former ABS-CBN talent and “Megastar” Sharon Cuneta.
“Having said that,” the TV5 chair added, “I think we intend to be here in the long term, and it’s difficult, no doubt, because we have two very strong incumbents, and we realized that when we invested in Channel 5.”
But Pangilinan said: “We think the future will change… I think, as a group, we will be an active catalyst in changing the future; otherwise we will be number three forever.”
This is not the first time the two networks have tried to get into bed together.
In 2001, PLDT, through MediaQuest, signed an agreement with the owners of GMA Network Inc, for a controlling stake. The amount involved then was a more modest sum of P8 billion.
The purchase deal did not push through after creditors of PLDT raised concerns over maturing dollar loans.
In 2004, PLDT’s mobile phone arm Smart Communications, renewed talks with GMA7. But that, too, fizzled out.
Pangilinan’s MediaQuest eventually acquired third liner TV5 in 2009.
Incidentally, GMA Network went to court against TV5 in 2008 after the second biggest network considered an existing partnership of TV5 with a Malaysian network as “unlawful” as it reportedly violated anti-dummy laws. Foreigners are banned by Philippine Constitution from owning media assets here.
The law suit, which became moot with the entry of the Pangilinan group, was eventually dropped.
Pangilinan runs two of the biggest local conglomerates in the country controlled by Hong Kong-based First Pacific Ltd. Of these, the telecommunications group under the Philippine Long Distance Telephone Co (PLDT) is the largest and the most profitable.
Pangilinan has pursued a convergence strategy, which marries content and delivery.
Telecommunication assets under PLDT play a major distributor role while its several media assets provide the content.
In this strategy, Pangilinan has always stressed the importance of “scale.” The bigger the assets, the more savings and the wider the reach the group could realize through synergies.
On the distribution side, PLDT has recently finalized its mega-merger with third-liner Digital Telecommunications Inc., the telecommunications arm of the Gokongwei group.
The merger of the two telco giants has been considered controversial as it stoked fears of a return to monopoly. PLDT-Digitel now controls over 70% of the local telecommunications industry.
Meantime, on the content side, Pangilinan group’s MediaQuest acquired stakes in broadsheets BusinessWorld Publishing and The Star Group.
The Pangilinan group, known to always push for a controlling stake, has not made more aggressive strides in these publishing assets when it could not pursue a majority ownership.
Pangilinan has previously said that they are not interested anymore in additional media assets, including state-owned RPN-9 and IBC-13, as new broadcast technologies allow their group to make the most of existing frequencies.
Watch Pangilinan’s previous comments on the state-owned assets here. – Rappler.com; with reports from Lala Rimando