GMA 7 denies ‘loose claims’ on network

GMA 7 is not for sale—not just yet.

Gmanetwork president andcoogilberto R. Duavit Jr. yesterday refuted claims made in an article contributed by Winston Marbella titled “Networks shakedown rocks industry” (INQUIRER Entertainment, April 27), which he said made loose claims and implied that broadcast television was having problems staying on its feet.

Duavit said he was quoted out of context when Marbella attributed to him the statement, “that is not to say that GMA 7 will not be sold,” when what he has said—repeatedly—is, “GMA 7 is not for sale … but that is not to say that GMA may not be sold, depending on the offer price.”

Duavit affirmed Marbella’s claim that GMA7 is not in serious negotiations with the Philippine Long Distance Telephone (PLDT) but questioned the writer’s contention that 100 percent of GMA 7’s value is fixed on an amount that is based on the share trading price of the total number of listed shares on the stock exchange.

According to the network executive, Marbella should have pointed out that 30.86 percent of the company’s stock is in the form of preferred shares that are not listed on the stock exchange. These preferred shares, he said, have been fully disclosed to the Philippine Stock Exchange and to the Securities and Exchange Commission.

Duavit also belied Marbella’s presumption that GMA 7’s increased spending was “driven solely by competitive pressures.” He clarified that GMA 7’s increased programming spending in 2011 was a “deliberate and conscious investment made by the company to attain its objective of dominating the national ratings, the benefits of which have been obvious.”

He also denied Marbella’s insinuation that the broadcast industry was in dire straits. On the contrary, he claimed that despite the cutbacks in ad spending by some major advertisers last year, 85 percent of the network’s total ad revenue target for the year 2012 was secured by advertiser commitments in February this year.

Taking exception to Marbella’s statements that GMA was less than a big industry player, he asserted that the network “leads in the national ratings” and “continues to be the most profitable broadcast network in the country.”

He said the network was also “devoid of any long-term debt.” “Its business revenue in areas outside of conventional television advertising continues to grow, most notably through its international channels.

“If GMA 7 has seen its best days, as Mr. Marbella implies, then it begs the question as to why the value of our company is pegged at such a huge amount. More pertinently, why is TV5 spending billions to build its infrastructure, to pirate talents, and to take losses just to gain a foothold in the industry?

“Mr. Marbella’s final comment that ‘It would be prudent for GMA 7 to start preparing while the price is right’ is a clear indication that he has absolutely no idea what GMA 7 is worth as a company.”