Hours after a quiet annual meeting, ABS-CBN moved to triple its authorized capital and expand its board. The P6-billion rescue brings money without more debt, but at the price of diluting the owners already there.
The new investors were nowhere in sight when ABS-CBN Corp. held its virtual annual stockholders’ meeting Wednesday morning, August 19. By afternoon, the company had started making room for them. Hours after stockholders elected a 7-member board and adjourned an annual meeting whose agenda had been set before ABS-CBN’s P6-billion rescue was signed, the newly organized board proposed adding two more chairs around its own table. It also approved tripling the company’s authorized capital, creating enough shares for the investors putting fresh money into the wounded media company. Stockholders will be called back on September 30 to approve both changes.
The capital increase was expected. ABS-CBN has agreed to issue 1,643,835,616 new common shares in exchange for the P6 billion, but it simply does not have enough shares available today to give the investors. The two additional seats around the board table are more intriguing. ABS-CBN did not say who they are intended for, but their creation comes just a week after I&C Holdings Corp. agreed to put P3.5 billion into ABS-CBN, by far the biggest contribution to the rescue. Three Lopez family branches — Crème Investment Corp., Mantes Corp., and Presta Holdings Company Inc. — are putting in another P2.2 billion from personal resources, while Lopez Inc., the longtime controlling shareholder that sits at the apex of the Lopez empire structure, had earlier been identified as contributing another P300 million. It is therefore too early to say whether one or both new seats are being created for I&C, for representatives of the Lopez branches putting fresh money directly into ABS-CBN, or for someone else altogether.
