SkyCable, Dream negotiating merger

By ANNA BARBARA L. LORENZO, BusinessWorld Reporter A merger between the largest pay television service providers is in the offing as Lopez-led Beyond Cable Holdings, Inc. and Dream Satellite TV negotiate for partnership. Beyond Cable Chairman Eugenio Lopez III refused to divulge a time frame but said both parties will "eventually merge" when negotiations are completed. "It’s at the due diligence stage. It has to be plus-plus for both sides. The proposal is Beyond Cable will be for urban, and in the provincial arena, Dream," Mr. Lopez told BusinessWorld. Beyond Cable, the result of the merger of SkyCable and Home Cable, has about 500,000 subscribers. Dream Satellite, which is under Philippine Multimedia Systems, Inc. (PMSI), has about 70,000 subscribers nationwide. Talks between PMSI and Beyond Cable started when Philippine Long Distance Telephone Co. failed in its bid to buy Dream Satellite in December 2005. PLDT the other day said it has ongoing negotiations with GV Broadcasting Systems, Inc., another direct-to-home satellite television provider. GV Broadcasting operates AM and FM radio stations. It is set to install, operate and maintain a nationwide digital mobile television broadcasting system pending an approval from the National Telecommunications Commission. Dream was earlier restrained from airing channels of ABS-CBN Broadcasting Corp., an affiliate of Beyond Cable. However, the merger is seen as a key to resume the broadcast of free television channels like ABS-CBN and Studio 23 on Dream Satellite. On the other hand, Beyond is seen to tap Dream Satellite’s facilities to allow the cable firm to offer multi-tiered cable service pricing and expand cable service access to the C, D, and E markets. "The agreement is a consolidation of the pay TV businesses. It is cost efficient, with ABS-CBN’s strength in content, and Dream’s infrastructure and technology," a top official of PMSI earlier said. Beyond Cable earlier expressed interest to go public when it completes the three-year profitability requirement of the Philippine Stock Exchange. The cable firm is part of Lopez-led Benpres Holdings Corp., which likewise has direct-to-home ventures in the United States and Europe through ABS-CBN Broadcasting Corp. ABS-CBN Global offers The Filipino Channel through an exclusive partnership with DIRECTV, Inc. The subsidiary yielded P3.6 billion in revenues for ABS-CBN last year. Aside from its multimedia business, the Lopez group also has interests in telecommunications, as well as power and water utilities.