ABS-CBN shares slide as trading resumes after network shutdown
Metro Manila (CNN Philippines, May 18) – Shares of ABS-CBN Corporation slid 7.2 percent on Monday as it resumed trading almost two weeks after the government ordered its broadcast operations to be shut.
ABS-CBN shares ended at ₱16.24 apiece, down from the ₱17.50 closing rate when these were last traded on May 5. The Philippine Stock Exchange imposed a trading suspension on the stock as well as ABS-CBN Holdings Corporation, the network's investor and issuer of depositary receipts, the next day following the news that the National Telecommunications Commission issued a cease and desist order against the company's TV and radio broadcasts due to an expired franchise.
ABS-CBN Holdings also saw its value slide by 4.67 percent to ₱14.70 by the closing bell. Trading of these stocks resumed 9 a.m. of Monday since being suspended on May 6.
Investors have clearly been spooked by NTC's order and the subsequent decision of the network to halt its broadcasts for the time being.
"Well the fact it is down, more investors are worried about the long-term outcome of ABSCBN's franchise. Although price has in fact recovered, there are many of speculators who believe that in the end, the franchise will be granted," Luis Limlingan, managing director o stock brokerage firm Regina Capital, told CNN Philippines.
He added that the performance of these shares will likely depend on every development relating to the network's franchise.
The country's biggest and longest-running media network had been lobbying for a franchise renewal as its 25-year authority expired May 4. The House of Representatives and Senate earlier asked NTC to issue a provisional authority that will keep the media giant on air while they tackle bills granting another 25 years to the network. The NTC committed to issue the provisional authority in March, only to rescind that decision this May.
The network has since appealed the NTC order before the Supreme Court, and has revealed that the company is losing ₱30 million to ₱35 million every day that it is off the air, and that some 11,000 employees may be forced out of their jobs if the shutdown continues. It claimed that the regulator violated the media company's right to due process and that the network's closure "will cause serious and irreparable damage" to the public interest and the people's right to know.
ABS-CBN lawyers again prodded the high court on Monday and made a fresh appeal for the immediate issuance of a halt order that will nullify NTC's directive and allow the network to return to air.
The network also sought a writ of preliminary injunction against NTC and its personnel to stop them from enforcing the cease and desist order, citing the "grave injustice and irreparable injury" it has brought to the media conglomerate and its workforce.
Last week, the House passed on second reading a new bill granting ABS-CBN a franchise until October 31 to allow continued operations while discussions on the grant of the usual 25-year mandate remains pending. This still needs to be affirmed on third reading and then sent to the Senate for their own deliberations before getting passed as law.
"The Company is confident that it has not committed any violation of the terms of its franchise, permits and licenses or any applicable law or regulations as to merit the non-renewal of its franchise or suspension of its broadcast operations as a consequence," the Lopez-owned network told the local bourse in a May 15 disclosure.
Lawyer Larry Gadon, who lost during the 2019 senatorial elections, went to the Senate on Monday morning to deliver a letter to Senate President Tito Sotto III asking that all senators who signed a resolution urging NTC to revoke its shutdown order against ABS-CBN to inhibit from further deliberations and voting on bills tackling the broadcast firm's franchise.
Last week, twelve senators signed a resolution telling the broadcast regulator to reconsider the cease and desist order it issued against ABS-CBN, citing the need to provide access to news and save the jobs of thousands of workers.
Media groups have condemned the NTC order, saying it was an affront to freedom of speech in a democracy.
