Pangilinan upbeat on GMA 7 deal forged by year-end

Manny Pangilinan. INQUIRER file photo

Philippine Long Distance Telephone Co. (PLDT) chair Manuel V. Pangilinan is confident that a deal to acquire GMA Network Inc. will be forged before the end of the year.

On Thursday, Pangilinan said investments in media assets would be vital to the PLDT group’s goal of transforming into a multimedia and technology conglomerate to grow profits and compete with increasingly popular Internet-based messaging services like Skype.

“Discussions are moving positively,” Pangilinan told reporters on the sidelines of PLDT’s annual shareholders’ meeting on Thursday.

Pangilinan said he last discussed the potential deal with the TV network’s top shareholders—the Jimenez, Duavit and Gozon families—before he left for the United States as part of President Benigno Aquino’s contingent on his recent state visit.

Well below P100B

“There could be an agreement this year between me and the three families. But whether we can get the necessary government approvals before 2013 is another story,” he said.

Pangilinan also clarified that the price being negotiated at the moment was well below the P100-billion tag mentioned by GMA chairman Felipe Gozon last month.

He explained that all telecommunications companies around the world are facing competition from so-called “over the top” players like Skype and Facebook that allow people to communicate over the Internet, bypassing regular long distance or domestic phone lines.

“Margins are getting depressed. Shareholders don’t like to see that, so the next frontier is media space,” he said.

If any deal is reached, Pangilinan said the group would buy GMA through MediaQuest Holdings, a subsidiary of PLDT’s Beneficial Trust Fund.

MediaQuest’s other investments include a majority stake in Associated Broadcasting Corp., operator of TV5, and a minority interest in several newspapers, including the Philippine Daily Inquirer.