ABS-CBN Corp.’s thousands of employees and millions of fans are not the only ones hurting from the shocking closure of the media giant.
COL Financial said ABS-CBN’s big-time creditors were likely to suffer the biggest blow from the National Telecommunications Commission’s decision to yank the media firm off the air on May 5, a day after its franchise expired.
“If ABS-CBN’s free-to-air TV and radio channels are not allowed to resume operations on the next few months, it won’t be able to pay off most of its P26.5 billion worth of long-term debts due to various banks and bond holders with around P2.4 billion due next year,” said COL.
COL said ABS-CBN can survive a few months without cash flow with over P20 billion in cash and short-term investments to cover over P16 billion in debts due this year.
But COL said an extended time off the air could be disastrous as the free TV and radio channels account for half of ABS-CBN’s and the only profitable business to the company.
ABS-CBN’s cable, satellite, and broadband operations are all in the red while its digital business or websites have yet to generate any profit for the company.
With cash drying up, COL said ABS-CBN will be forced to lay off its employees who cost the company P14.1 billion a year (including talent fees) or P1.175 billion a month.
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