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  • ABS-CBN Faces Financial Crisis as TV5 Exits Over ₱1B Dispute: Why Lopez Group Must Use Its ₱50B Windfall to Rescue Its Media Flagship

    ABS-CBN Faces Financial Crisis as TV5 Exits Over ₱1B Dispute: Why Lopez Group Must Use Its ₱50B Windfall to Rescue Its Media Flagship

    TV5’s termination of its partnership with ABS-CBN over a ₱1 billion payment demand exposes deep financial cracks. With ₱13 billion in payables and cash reserves down to ₱718 million, the Lopez Group must act fast—using its ₱50 billion windfall from First Gen’s sale to Enrique Razon—to prevent a collapse that could damage its entire credit reputation.

    When TV5, backed by the Manny Pangilinan group, pulled the plug on its partnership with ABS-CBN and demanded a ₱1 billion payment, it wasn’t just a broken deal—it was a warning shot. A signal that the financial cracks in ABS-CBN are widening, and the tremors could shake the entire Lopez Group.

    The numbers are stark: ABS-CBN’s SEC filing shows ₱13 billion in trade and other payables, a ₱11 billion working capital deficit, and cash reserves down to ₱718 million. These aren’t minor hiccups—they’re existential threats. When a major partner like TV5 walks away over unpaid obligations, others will take notice. Talent agencies, event venues, content licensors—they could all demand immediate settlement. If that domino effect begins, ABS-CBN’s operational lifeline could snap.

    Here’s the irony: the Lopez Group is sitting on a ₱50 billion windfall from the sale of its natural gas assets under First Gen Corp. to Enrique Razon’s Prime Infra. That deal was hailed as a strategic pivot to renewables. But what good is a green future if the flagship media arm collapses today? Deploying even a fraction of that windfall—₱10 to ₱15 billion—could stabilize ABS-CBN, clear critical payables, and restore partner confidence.

    And here’s the urgency: declare a portion of that windfall as dividends to First Philippine Holdings (FPH). Why? So FPH can acquire ABS-CBN outright and inject fresh capital to fix its battered finances. This isn’t just about saving a network—it’s about protecting the Lopez Group’s credit reputation. Letting ABS-CBN be hounded by creditors, suppliers, and banks will tarnish the group’s standing in the financial community. For a conglomerate that relies heavily on bank financing for power and infrastructure projects, that’s a risk too costly to ignore.

    This is no longer about pride or politics. It’s about survival. The Lopez Group must act decisively. Upstream the funds. Shore up ABS-CBN’s balance sheet. Send a message to partners and creditors: we pay our bills, we honor our commitments, and we protect our brands.

    Because in business, perception is reality. And right now, reality is screaming for leadership.

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  • ERC Greenlights ₱90-B Grid Link: DMCI Power Faces Strategic Crossroads, SGP Gains from Transmission Push

    ERC Greenlights ₱90-B Grid Link: DMCI Power Faces Strategic Crossroads, SGP Gains from Transmission Push

    The Energy Regulatory Commission (ERC) has approved the National Grid Corporation of the Philippines’ (NGCP) ₱89.98-billion Batangas–Mindoro 500-kilovolt interconnection and backbone project, a landmark initiative that will connect Mindoro to the Luzon grid and reshape the island’s power dynamics.

    Under the ERC directive, Stage 1 of the project must be completed by September 30, 2027, with Stage 2 targeted for December 31, 2030. Once operational, Mindoro will cease to be an off-grid missionary area, enabling access to cheaper and more stable electricity from the national grid.

    Impact on DMCI Power

    DMCI Power, the exclusive off-grid supplier in Oriental Mindoro, currently serves the province through diesel and bunker plants under long-term contracts. In 2024, the company sold 104.8 GWh in Mindoro, generating an estimated ₱1.62 billion in revenue at an average tariff of ₱15.5/kWh.

    Analysts warn that the interconnection will erode DMCI Power’s competitive advantage:

    • Luzon grid rates (₱5–₱7/kWh) could displace DMCI’s high-cost generation.
    • Contract renegotiations or non-renewals are likely post-2027.
    • Existing plants risk becoming stranded assets unless repurposed for backup or renewable integration.

    Why It Benefits SGP

    Synergy Grid & Development Phils., Inc. (SGP), the holding company of NGCP, stands to gain from this development. The Batangas–Mindoro link is part of NGCP’s 2025–2050 Transmission Development Plan, aimed at strengthening and expanding the national grid. For SGP:

    • Regulated returns: Transmission projects earn stable, regulated revenues under ERC-approved tariffs.
    • Long-term growth: The ₱90-billion investment adds to NGCP’s rate base, boosting future earnings.
    • Strategic positioning: Enhances NGCP’s role in grid modernization and reliability, reinforcing SGP’s value proposition to investors.

    Investor Takeaway

    For DMCI Power, the project signals a structural shift: earnings from Oriental Mindoro will remain stable until 2027 but face steep declines thereafter. For SGP, the interconnection project is a growth catalyst, underpinning its regulated revenue model and long-term expansion strategy.

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