PLDT-owned Cignal Cable announced on Thursday, Aug. 11, that it has entered into a sale and purchase agreement for the acquisition of 38.88% of ABS-CBN cable operator Sky Cable for a total consideration of P2.862 billion.
Cignal Cable said its investment in Sky Cable is expected to benefit the Lopez firm’s existing customer base consisting of over 300,000 cable subscribers and close to 350,000 broadband subscribers as of the end of June 2022.
“This will allow Sky Cable to expand significantly its coverage, offerings, and services. It will also enable Sky Cable to expand its broadband reach and capacity in support of the government’s plan to prioritize the development of the country’s digital infrastructure, reaching a larger portion of the Filipino population and providing them with greater choices for their content and Internet requirements,” said in statement.
In 2020, PLDT sought to acquire Sky Cable but abandoned it eventually citing possible anti- competition issues.
Simultaneously with the execution of the sale and purchase agreement, the parties also executed an agreement whereby Sky Vision Corporation – the corporate entity of Sky Cable — agreed to issue an exchangeable debt instrument to Cignal Cable with a face value of P4.388 billion.
The debt instrument gives Cignal Cable the option to acquire additional Sky Cable shares equivalent to 61.12% of the outstanding capital stock of Sky Cable after eight years from its issuance, subject to obtaining regulatory approvals.
Under the debt instruments agreement, Cignal Cable will also acquire a convertible note issued by Sky Cable with a face value of P250 million and convertible into primary shares of Sky Cable representing about 1.84% of outstanding capital stock.
The proceeds of the sale of the sale shares, the convertible note, and the issuance of the debt instrument in the total amount of P7.5 billion will be used to repay certain obligations of ABS-CBN and Sky Vision and to fund the investment of ABS-CBN in TV5.
ePLDT, a subsidiary of PLDT, will fund, through a loan extended to Cignal Cable, the P7.5-billion acquisition cost of Cignal Cable of the sale shares and the foregoing debt instruments.
Cignal Cable said its entry into Sky Cable will strengthen and enhance its public services offerings. Currently Sky Cable is operating Knowledge Channel, which provide educational programs for children, and DepEd Channel, which offered long-distance learning to the Filipino youth during the pandemic in cooperation with the Department of Education.
Cignal Cable plans to expand the public services programs that will be offered by Sky Cable to assist the gin providing public services to the Filipinos, particularly in remote areas.
