ABC OWNER TAN, COJUANGCO TO SIGN P5-BILLION ABC-5 DEAL
Manila, September 23, 2003 (STAR) By Mary Ann Ll. Reyes - Associated Broadcasting Corp. (ABC-5) owner Edward Tan and a group led by businessman Antonio O. Cojuangco are expected to close a deal before Sept. 30 for the acquisition by the latter of the television network for a price of P4.5 billion to P5 billion.
"What is definite is that by Oct. 1, Tonyboy Cojuangco will officially own ABC-5. But right now, it is already a done deal, unless Eddie Tan comes up with surprises," reliable sources told The STAR.
Between Oct. 1 and Dec. 30, Cojuangco’s group will have to pave the way for a smooth transition, including seeking necessary government approvals for the change of ownership i.e. from the National Telecommunications Commission, meeting with ABC-5 officials and employees, appointing key personnel to the network, among others. "Most of the top management of ABC-5 will be absorbed except for some people who owe loyalty to Tan," a source close to Cojuangco said.
Cojuangco’s group hopes to be running ABC-5 beginning January next year. Cojuangco will be the chairman and chief executive officer and is expected to actively manage the network.
The acquisition price will include two parcels of land as well as certain liabilities owed to suppliers. The same sources disclosed that Tan will get P2 to P3 billion from Cojuangco’s group, of which about half a billion was already received as downpayment.
The indicative price for ABC-5 was earlier placed at P4 billion. However, following due diligence investigations, sources said Cojuangco wanted to bring the purchase price down to less than P2 billion because he did not want to absorb the liabilities and buy the land.
It will be recalled that the Concepcions of the RFM Group and PLDT’s Manny Pangilinan earlier made a pitch for ABC-5 at a price of close to P2 billion, which was rejected by Tan.
Disagreement over pricing almost led to the collapse of the talks between Cojuangco and Tan. Sources said Cojuangco would have walked out of the negotiations had he had not been reminded that Tan could sue him because of the memorandum of agreement earlier signed between the two parties.
It is not clear up to now why Cojuangco wants to go into the broadcasting business, although his group claims ABC-5 will instantly give Cojuangco’s Dream Broadcasting Corp. which is into satellite television a nationwide reach. ABC-5 has around 15 stations and more than 100 cable TV affiliates nationwide.
Insiders told The STAR that under the new management, ABC-5 will have a different kind of programming in such a way that it will not be competing head on with industry leaders ABS-CBN and GMA Network.
Reported by: Sol Jose Vanzi
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