Conglomerate Ayala Corp. may take interest in the frequencies of ABS-CBN Corp. that might be recalled by the government after the National Telecommunications Commission ordered the shutdown of the Lopez-led broadcast network over the lack of a congressional franchise, according to sources.
Sources said Broadcast Enterprises and Affiliated Media Inc., which is owned by Betlehem Holdings Inc., the holding company of Globe Telecom’s group retirement fund, may be used by the Ayala Group to bid for the frequencies of ABS-CBN Channel 2, DZMM 630 AM radio and MOR 101.9 FM radio.
BEAM is a broadcast company in the Philippines that operates free-to-air Channel 31. The company’s primary focus is on UHF broadcasting, but is upgrading its DTT for use in multimedia convergence. BEAM has transmitter facilities in Davao, Cebu City, Zamboanga City, Baguio City, Naga City and Iloilo City.
Sources said the Ayala and Lopez groups have a history of partnership in telecom and broadcast industries, as Globe Telecom completed the acquisition of Bayan Telecommunications from the Lopez family in 2015. Globe also entered a network sharing agreement with ABS-CBN Corp. to offer ABS-CBN Mobile, but the mobile service was discontinued on Nov. 30, 2018.
Sources also said members of the Makati Business Club saw a deal between the Ayala and Lopez groups coming even before the closure of ABS-CBN. “In fact, they see this as a strategic move to save the Lopez company from its maturing P28-billion bank loans from BDO, BPI, PNB, UnionBank whose owners are all members of the MBC,” sources said.
BPI, the banking arm of the Ayala Group, has more than P10 billion in loan exposure to ABS-CBN, according to reports.
An executive of ABS-CBN denied any ongoing talks between the two parties. “It is not true,” the executive said.
Yla Patricia Alcantara, head of brand reputation and management of Ayala Corp., dismissed the report as rumor. "As far as Ayala Corporation is concerned there is no truth to that rumor. As the company reported in its recent annual stockholders’ meeting, Ayala remains focused on growing its core businesses while supporting immediate concerns of the government to fight COVID-19," Alcantara said.
Sought for comment, Yolanda Crisanto, spokesperson of Globe, also denied there were discussions between Globe and ABS-CBN. “We wish to clarify that there is no ongoing discussion between BEAM and ABS-CBN. Also Globe has no equity stake on ABS Convergence. What we had was an MVNO agreement.”
Astro del Castillo, managing director at First Grade Finance, said such transaction “would be a surprise.”
“The Ayala Group has never been in the news that they are really interested [in broadcasting business]. After the tiff with the president regarding the water, would it boldly invest in another controversial investment at this time,” Del Castilo said.
“If indeed true the public, particularly the financial analysts would be excited to hear the side of Ayala on their business model and how it would add value to its businesses,” he said.
Sources said the rumors became more possible after Davao-based businessman Dennis Uy, chairman of Udenna Corp., issued a statement to deny that he wanted to acquire ABS-CBN. “Let me be clear once and for all and say that we in Udenna Corp. have no intention to acquire ABS-CBN. Being in the business of broadcasting is not part of our corporate direction,” Uy said.
Sources said that once the government auctions the frequencies of ABS-CBN, BEAM is in the best position to acquire them estimated to be worth billions because it is backed by the Ayala Group.
Sources said those who may join the bidding for ABS-CBN’s frequencies are Aliw Broadcasting Corp., Manila Broadcasting Corp., Radio Mindanao Network, Bombo Radyo Holdings Inc. and Sunshine Media Network of religious leader Apollo Quiboloy.
Sources believe that given the high valuation of the ABS-CBN frequencies, BEAM will have the upper hand in the auction.