SCUTTLEBUTT

Sky’s fortunes won’t Converge

The long-gestating proposed merger of Converge ICT and Sky Cable Corp. is moving forward but the loss-making Lopez cable TV unit first needs to comply with the conditions set by Converge, a company insider intimated to Scuttlebutt.

Converge, the leader in broadband internet services, lacks a content provider like Sky Cable, but the latter must first pay off a significant portion of its debt before the Dennis Uy firm would agree to a rescue.

Converge is also seeking from Sky a P1 billion a year slash in costs through energy conservation, removal of pole rental fees, and a cut in maintenance expenses. Converge has offered Sky a network-sharing agreement in line with the cost-cutting measures that would translate to lower infrastructure costs for the cable TV firm’s network.

Industry estimates place the Sky acquisition at a minimum of P13 billion, or the sum of the P6.75-billion valuation from PLDT’s previously scrapped deal plus P4.5 billion worth of debt.

An outlay of P2 billion is also needed to sustain Sky Cable’s personnel. Some P3.2 billion of the P4.5-billion debt is due in a year, which would leave just P1.3 billion in residual debt, assuming Sky pays the amount due.

Settling the majority of the debt would put Converge in a stronger position to consider the acquisition.

If Sky meets these conditions, the synergy between the two could be a win-win as Converge would greatly benefit since the telco’s Enterprise services have expanded into hospitality TV solutions (Converge Concierge) alongside recent partnerships with over-the-top media such as Netflix, according to AP Securities.

The brokerage house, however, said that given Sky’s current state, the timing is not right as it would better serve Converge to focus on its growth while keeping an eye on Sky as it picks itself up from its debts and losses. TDT

LGUs drag feet on EO 32

Globe Telecom has termed it a substantial progress but the numbers don’t lie as local governments appear to be grudgingly complying with Executive Order 32 issued last year.

Under the presidential directive, permits and license processing improved by a mere 20 percent.

At the recent 2024 Ease of Doing Business Convention organized by the Anti-Red Tape Authority, Globe underscored the need for more local government units (LGUs) to be consistent in applying streamlined processes under EO 32 to maximize its potential to reduce bottlenecks associated with securing essential permits.

Among the persistent challenges, according to the giant telco, are LGUs’ reluctance to implement the Electronic Business One-Stop Shop, the diverse requirements and ordinances, slow pace of tower construction in certain areas, and astronomic costs due to additional fees and extended approval times.

eBOSS was designed to reduce personal interactions, and thus the discretion on the approval of licenses which would negate the signature-for-a-fee racket.

Along with establishing uniform standards, Globe emphasized the importance of eliminating excessive fees and requirements to create a more supportive environment for telco infrastructure growth.

EO 32 aligns with President Ferdinand Marcos Jr.’s vision for telcos to have the capacity to reach more communities and businesses.

Among the exemplary communities that Globe cited are Antipolo City in Rizal, Bacoor City in Cavite, Calamba City in Laguna, and Metro Manila cities Marikina and Navotas.

The LGUs of these cities maintain the “one-stop shop” business permit process, eliminating the need for telcos to secure them independently. Cities like Mandaluyong, Manila, and Bacolod have also further simplified the process by removing certain clearance requirements independently.