PLDT acquires Sky Cable for P6.75 B

PLDT Inc. has entered into a Sale and Purchase Agreement with the Lopez Group for the acquisition of 100 percent of Sky Cable Corporation (Sky) for P6.75 billion.
In a disclosure to the Philippine Stock Exchange, PLDT said it is acquiring all the issued and outstanding capital stock of Sky from Sky Vision Corporation, ABS-CBN Corporation, and Lopez, Inc.
Sky is primarily engaged in the business of providing broadband services marketed as “Sky Fiber” and enterprise cable broadband services marketed as “Sky Biz.” In addition to broadband business, Sky also provides pay TV and cable services.
This acquisition by PLDT covers the broadband business and the related assets of Sky subject to compliance with certain conditions including the termination or cessation of operations by Sky of its pay TV and cable businesses, obtaining all applicable government approvals and clearances, and obtaining all required consents and corporate actions.
The acquisition consists of 1.38 billion Sky shares priced at P4.9043 per share based on the agreed implied equity valuation of Sky less recorded payables and contingent liabilities.
PLDT will be paying P6.345 billion representing 94 percent of the Purchase Price on the Closing Date while the balance of P405 million will be paid upon delivery of the Certificate Authorizing Registration/Tax Clearance issued by the Bureau of Internal Revenue for the sale and purchase transaction and compliance with other post-closing deliverables.
In a separate disclosure, ABS-CBN said it is selling 808.03 million Sky shares representing a 58.7 percent stake for total gross proceeds of P4 billion.
“The proceeds to be received by Sky Vision will be used, among others, to settle its obligations, including its obligations to ABS-CBN,” the firm said.
It noted that, “This was a strategic decision resulting from, among other things, the significant capital expenditure requirements of Sky Cable to maintain its competitiveness.”
“The proceeds from the sale of the shares of ABS-CBN and the settlement of Sky Vision's obligations to ABS-CBN will be used by ABS-CBN to settle and fund its retirement obligations. The sale of the company's ownership in Sky will also allow ABS-CBN to focus its resources on content creation,” ABS-CBN added.
“The proposed transaction is aligned with PLDT’s mission to narrow the digital divide by expanding broadband connectivity, and supports the government’s push to expand the nation’s digital infrastructure,” the telco giant said.
It added that the proposed transaction is expected to benefit the existing broadband subscribers of both PLDT and Sky by strengthening and expanding the coverage of their offerings and services, particularly in remote areas; and upgrading overall customer experience through the combined expertise, resources, and capabilities of PLDT and Sky.
While awaiting the required regulatory approvals, Sky Cable's broadband and cable TV services will continue. Once approvals are obtained, Sky Cable is committed to working with all its cable TV subscribers to ensure a transition to their preferred service.