ABS-CBN Corp. said on Thursday it has signed a standstill agreement with its lenders, giving the Lopez-led company a bit of breathing room to pay off its obligations.
“The existing lenders of the company today agreed to make its standstill agreement with the company effective, i.e. not to declare any event of default or to exercise any rights or remedies under existing loan agreements, after compliance by the company with the lenders’ condition of the creation of a mortgage and security interest over certain assets of the company,” a regulatory filing read.
A standstill agreement is a contract between a lender and a creditor that holds in abeyance the debt owed for a specific period.
The BusinessMirror sought for more information and a few clarifications on the standstill agreement, but ABS-CBN officials have yet to reply as of press time.
According to its third quarter of 2020 financial statement, the company had a total debt of P21.48 billion. This includes debt of its subsidiaries such as SkyCable and ABS-CBN International.
ABS-CBN Corp. went off air last May 5, 2020 after the National Telecommunications Commission issued a cease and desist order against the network following the expiration of its legislative franchise on May 4, 2020.
In July 2020, the House Committee on Legislative Franchises rejected the franchise application of ABS-CBN.
This after the House Committee on Legislative Franchises adopted a resolution denying the franchise application of ABS-CBN to construct, install, establish, operate and maintain radio and broadcasting stations in the Philippines.
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