Ang, GMA at ‘war’ over scuttled deal

By Luis Leoncio

The sudden termination last Tuesday of negotiations for what had promised to be a blockbuster deal between GMA Network Inc. (GMA) and San Miguel Corp. President and Vice Chairman Ramon S. Ang has sparked a bitter word war between the two camps over who’s to blame for the turn of events.

GMA accused Ang of not being straightforward in recounting the circumstances behind the scuttling of the deal in which Ang sought a 30-percent minority stake in the television and radio network.

Ang said he was surprised by the announcement of GMA and hinted he was ditched by the network in the negotiations.

“The statement of the Buyer is not correct,” GMA Vice President for Communications Angela Javier Cruz said, however, referring to Ang.

Cruz added there were at least two documents transmitted last May 9 by the company’s counsel for the major shareholders, indicating the deal would likely fall through.

One of the documents was “the Share Purchase Agreement involving the Major Shareholders as participating in the sale with all the terms and conditions agreed upon by the sellers and the buyer, as per acceptance of the latter’s remaining position on certain issues by the former on Mar 21,” she said.

Cruz said the other document was the “Deed of Absolute Sale on the Gozon Group Shares” without the other groups participating, a document which was suggested after the discussion between Ang and GMA President Menardo Jimenez.

“Both transmittals were made by counsel on a without-prejudice basis, given that on March 26, Buyer already walked away and informed Sellers that he is no longer proceeding with the Transaction on grounds of alleged material changes on the Company which are not valid and not borne by the facts and recent financial reports of the Company,” Cruz said.

In a disclosure to the Philippine Stock Exchange (PSE) last Tuesday, GMA said “the Company has been informed by its majority shareholders [Jimenez Group, Gozon Group and Duavit Group)]that the negotiation with Mr. Ramon S. Ang on the sale and purchase of a participating minority equity interest in the Company’s outstanding capital stock is now deemed terminated.”

Ang then told the media that he was caught flatfooted with GMA’s disclosure and that he would seek an explanation from the other party.

“I did not expect this. There was no indication they would do this in the middle of negotiations, I am consulting my lawyer and waiting for an explanation,” Ang said in a text message.

But Cruz said that contrary to the misimpression that may have been created  that GMA “abruptly terminated” the negotiations with Ang, it must be made clear that the negotiations lasted more than a year ad that the network was constrained to terminate them because of certain reasons.

GMA accepted on March 21, 2015, all the remaining proposals of Ang as of February 27, 2015, Cruz said.

“However, Ang continued to make new/additional proposals and/or make new requirements after the sellers had already accepted all of his proposals on March 21, 2015, and after the statements of Mr. Gozon during the Company’s financial briefing on May 14, 2015, were widely published in the broadsheets that ‘the ball is now in RSA’s court’, that there was no deadline given but decision should be made within a ‘reasonable time’,” she said.

Last month, in a report to the stock exchange, GMA Network said the negotiation with Ang currently was a wait-and-see (situation). “The ball is in the buyer’s court,” the report said.

On May 18, Cruz said Ang informed major shareholders of GMA that he does not accept the Deed of Absolute Sale, and proposed new matters and terms.

Cruz continued that on June 22, GMA’s major shareholders informed Ang that they did not agree to the new terms, to a renegotiation or to a new round of negotiation and reserved all their rights and remedies.

“Last Wednesday, Ang’s counsel provided another reason for not continuing with the transaction, citing the lapse of the Exclusivity Period on November 15, 2014. This was the first time that the Major Shareholders came to hear of this reason,” Cruz said.

“Ang, in fact, continued to negotiate beyond the cited exclusivity period even with the awareness that he was free to leave the negotiations at any time since November 15, 2014, if he did consider the period of negotiations to have expired,” Cruz added.

GMA Chairman and CEO Felipe Gozon, in a message to the employees of the broadcast firm, confirmed that the negotiations with Ang for the minority stake of the media company have been scuttled.

“Like what I have told you before, I will be the one to report to you the development over the offer of Mr. Ramon Ang to buy minority equity shares in GMA Network. So this is the latest – according to the majority shareholders of GMA Network [Jimenez, Gozon at Duavit groups], the negotiations with Mr. Ang regarding the purchase of minority equity in the outstanding capital stock of GMA Network have ceased.

“This development was already disclosed to the PSE and the Securities and Exchange Commission [SEC],” read a GMA announcement to its employees.

Ang earlier said he planned to invest in the media company in a personal capacity and the majority shareholders of the broadcast firm agreed 12 months ago to sell about 30 percent of the company to Ang.

The agreement was announced months after negotiations with the Philippine Long Distance Telephone Co. of businessman Manny V. Pangilinan for the purchase of shares in GMA Network, which also failed.