ABS-CBN and PLDT cancel Sky Cable deal; reasons undisclosed

ABS-CBN Corp. and PLDT Inc. announced on Thursday a decision to halt the sale of Sky Cable to the Pangilinan-led telecommunications company.

“Following this development, Sky Cable is pleased to announce that its cable TV service will continue, assuring its subscribers that they can maintain their subscriptions,” the Lopez-led media company said in an e-mailed statement to reporters.

“Sky’s internet broadband service, SKY Fiber, remains unaffected,” it added. Sky Cable provides broadband, enterprise cable broadband, pay television, and cable services.

In their disclosures to the stock exchange, ABS-CBN and PLDT did not provide reasons that led to the decision.

PLDT announced in March last year that it was fully acquiring Sky Cable for P6.75 billion, mainly to expand its coverage and services.

Just last month, the Philippine Competition Commission approved the sale of Sky Cable to the Pangilinan-led company.

The transaction would involve the sale of about 1.38 billion common shares at P4.90 apiece, with the purchase price based on the agreed equity valuation of Sky Cable’s shares as of Dec. 31, 2022.

The decision not to proceed with the sale raises questions about the underlying reasons or factors, according to analysts.

The cancellation of the sale could influence how the two companies are perceived in the market, Globalinks Securities and Stocks, Inc. Head of Sales Trading Toby Allan C. Arce said in a Viber message.

“PLDT might need to explore alternative strategies to strengthen its position in the cable TV and broadband market, while ABS-CBN retains its foothold in the industry,” he added.

The decision would also affect the financial outlook of the two companies, he said, adding that for ABS-CBN, the company might have been factoring in the proceeds from the sale to bolster its finances.

“PLDT Inc. might have factored in the acquisition costs and potential synergies from integrating Sky Cable into its operations, which will now need to be reassessed,” he said.

For his part, China Bank Capital Corp. Managing Director Juan Paolo E. Colet said the two parties should have disclosed the reasons why the deal was not pushing through.

“It’s also important for them to explain how they will manage their debt load considering that the deal was supposed to pay off loans,”  he said.

At the local bourse on Thursday, ABS-CBN shares closed 13 centavos or  3.02% lower at P4.17 apiece while shares in PLDT gained P10 or 0.78% to end at P1,298 apiece.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Ashley Erika O. Jose