Two-thirds vote to dissolve
This space has always maintained that unless PTIC is first
dissolved, the government cannot get a fair price of the 15 percent awarded it
by the Supreme Court.
We might have been proven right in the sense that the
government is now prepared to give a 15 percent discount to the same buyer,
First Pacific, which offered 66 percent premium in the event that the Court
should declare as belonging to the family of the late Ramon Cojuangco.
In a luncheon meeting with Finance Secretary Gary Teves and
his staff last Wednesday, we were told that dissolution is not possible. The law
requires a two-thirds vote to dissolve.
Since the government has only 46 percent in which the 15
percent of PLDT is lodged, it does not have what it takes to dissolve. The
suggestion is the 54 percent stockholders of PTIC which is basically First
Pacific, will not agree to a dissolution.
In effect, the government is trapped by First Pacific. And
that being so, Teves now argues that apart from the impossibility of
dissolution, there is the other factor that PTIC is not publicly traded.
Therefore, the government should agree, like it already has,
to a 15 percent discount.
Yes, it is possible
The state has enough powers to force a dissolution. But
unlike in many other cases, this time the Arroyo Administration invokes the law.
Dura lex, sed lex. The law is hard but it is the law.
Nothing could be harder that the fact that there is admission
by its own lawyers that Fraport owns 61.4 percent of Piatco, a public utility.
The NBI recommended prosecution of Piatco and Fraport
officials as well as Pantaleon D. Alvarez, for violations of the anti-dummy law.
The Department of Justice dismissed the complaint.
What these two cases simply tell us is that when the
government decides to violate the law, it does so with gusto.
When it decides to comply as in the case of the impossibility
of dissolving PTIC, it does so and even goes as far as losing money by giving a
discount.
The state has what is known as coercive powers. If it had
wanted to, it could get PTIC to dissolve the company.
Why did it not use moral suasion in this case and violate the
law in the other case? There’s only one answer
There are people who will benefit from violating the law and
also from complying with it. I smell corruption. Maybe bribery but what is the
difference?
Money in escrow
In fairness to the Department of Finance, it got information
from the Presidential Commission on Good Government that more than P2 billion
representing cash dividends for the 46 percent of PTIC now owned by the
government is now kept in escrow.
The effort looks like doing due diligence. But it did not go
far enough. Nobody in the Department of Finance could tell me whether or not
there has been stock dividends in the past.
I thought that if there had been, there should be a
corresponding increase in number of shares of PLDT held by PTIC. Not possible,
according to Teves’ assistant. Not even if there have been some stock dividends.
He said that all the dividends from PLDT arising from the
investment of PTIC go straight to the company.
Again, the reason is PTIC is not publicly listed. But why is
the P2 billion in cash dividends for the 46 percent held in escrow for the
government?
Is there a law that says that a non-listed corporation should
distribute cash dividends to stockholders but the stock dividends are kept by
the firm? I can’t believe it.
If this were so, and there were stock dividends from PLDT,
the PITC has been robbed blind.
Right of first refusal
The articles of incorporation of PTIC state "the subscription
for, or ownership of all shares of stock of the corporation are subject to the
condition that any holder of shares of stock desiring to sell or to transfer the
same shall first offer his/her stocks to the rest of the stockholders."
That gave the owners of 54 percent of PTIC the right of first
refusal on the 46 percent awarded by the Supreme Court to the government.
It seems, however, that the government is giving PTIC a
special accommodation. When First Pacific, buyer of the 46 percent and owner of
54 percent of the holding company failed to come up with the money, the right
should normally be extinguished.
But the Department of Finance is giving First Pacific until
March 8 to cough up the money, all P24.5 billion of it.
It is also important to remember that Manuel V, Pangilinan
earlier announced that he was creating a new group to buy the shares. In which
case, he would have insisted on dissolving PTIC so his group would be buying
PLDT shares and not 46 percent of PTIC.
Or was his group willing to be under the tender mercies of
First Pacific which owns 54 percent of PTIC?
If so, the group must have very close relationship with PTIC.
In any case it turns out, as we predicted, that only First Pacific will buy the
shares if the company is not dissolved.
Dangers of listing Philcomsat shares
Ricardo Abcede and his group are vehemently opposing the
listing of 80 percent of the outstanding shares of Philcomsat Holdings.
Not that he does not want to flood the market with more
shares. In which case, a bigger supply normally results in lower prices.
But that is not the reason for objecting to the listing.
He is clearly scared that if 80 percent of the shares are
listed, somebody might gobble it up.
If that happens there will be a change of ownership of
Philcomsat Holdings. If that happens the group of Abcede will be yanked out.
In fact, the new owners might even ask the officers of
Philcomsat, particularly Abcede who is a PCGG nominee, to explain the looting of
the company’s funds and allocate liability.
They will be hard put explaining why there are two joint
personal accounts which are funded by Philcomsat, withdrawn by its officers, and
nobody except the recipient really knowing where the money goes.
This has been brought into the open in the hearings called by Sen. Richard
Gordon, chairman of the Senate committee on government corporations.
