MANILA, OCTOBER 5, 2012 – GMA7 and MediaQuest Holdings Inc. have ended talks that began more than a decade ago for Manny Pangilinan’s vehicle to acquire the broadcast giant during which time the price tag reportedly ballooned from 8.5 billion pesos to a whopping 52.5 billion pesos.
The 52.5 billion price tag was the confirmed price reported last month.
This is the second time that MediaQuest chairman Pangilinan attempted to acquire the network, the first one being in 2001. Negotiations were stalled in 2004 after MediaQuest – a unit of Philippine Long Distance Telephone Company (PLDT) Beneficial Trust Fund – reduced its valuation of the broadcast company from Php14.58 billion to Php12 billion.
The sudden end to the latest round of talks took the industry by surprise. It was expected the acquisition was nearly a done deal before both sides called time on the talks. “The parties have been unable to arrive at mutually acceptable terms despite the continual discussions and efforts exerted in good faith,” MediaQuest and GMA said when the termination was announced to the public.
The end to talks have focused attention on the future of Pangilinan’s stated ambitions to turn PLDT into a multimedia organization through a convergence strategy and the group’s TV5 network, the smallest of the three broadcasters in the country and a distant third in viewership numbers.
“The termination of the GMA acquisition initiative is not expected to adversely impact the PLDT Group’s strategy of evolving from a traditional telecommunications company into a multimedia service company. The PLDT Group continues to believe that owning, producing and providing content across multiple platforms is an important component of its blueprint for growth and as such, intends to pursue its media strategy by building on MediaQuest’s current investments in TV 5… and Cignal TV,” said Pangilinan.
Despite previous statements that the company is for sale, GMA7 chairman and CEO Felipe L. Gozon said, “We are not peddling GMA for sale. Somebody wanted to buy and we attended to it. There is no plan B, no plan C, no plan D.” Speaking in behalf of the Duavit and Jimenez families, he said, “We are ready, prepared and willing to continue running the station [in case the talks fail].”
The last asking price was not disclosed, but speculation mounted that that the hefty price tag had likely derailed talks. Discussions entered a lull between June and September when it was reported that Pangilinan was eyeing a syndicated loan to finance the acquisition. At the time, both Pangilinan and GMA7 had promised to conclude negotiations before year-end.
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