THERE are questions which the more curious investors would probably ask but are too shy to ask regarding the unusual surge in the price of certain stocks listed on the Philippine Stock Exchange (PSE). Why is it that the officers of these companies don’t know anything about certain corporate developments that affect their prices? Shouldn’t dramatic price surge and drastic decline be seen as an indication that the stocks involved may be the target of a buyout, backdoor listing, or may be manipulation? Or is something cooking inside the board rooms which may drive up prices? All this should merit a closer look by the Philippine Stock Exchange and the Securities and Exchange Commission (SEC). The exchange may have the expertise but the SEC has lawyers and CPAs. By tapping their examiners, the commission, in fact, succeeded in documenting the alleged price manipulation in the trading of BW Resources Corp. (BWRC), which, from few centavos soared to over P100 per share many years ago. (Banco de Oro Unibank Inc. still owns close to 20 of the outstanding shares of BWRC after it acquired and merged with it Equitable PCI Bank.) It is also about time the SEC reactivates or deputizes its people to see how certain stocks behave erratically. This suggestion for a more regulatory vigilance is only intended to maintain the resurging investor confidence on the stock market, the major factor for the market’s recovery from a long slump.

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For a start, SEC chairman Fe Barin and the four commissioners might want to task their CPAs and lawyers to find any link between Pacifica Inc. and Wellex Group Inc., two listed companies that recently figured in curious upswings and downswings. Trading on Pacifica remains suspended since July 17, 2007, a day after it soared 466.666 percent to P0.17 on July 16, 2007, from a low of P0.03 on July 2, 2007. In contrast, Wellex, which is the corporate investment vehicle of businessman and plastics king William Gatchalian, closed at P0.75 on June 21, 2007 only to drop 56 to P0.33 on July 3, 2007. How about its performance between, before and after, these two dates?

Here are more clues to regulators. Records show that Pacifica, which faces some questions about the earlier price swing which “insiders” attributed to a possible big-ticket project in Manila’s northern port, is dominated by that high-flying Cesar Quiambao. Wellex, on the other hand, has been warned by the PSE over the sale of a big block of shares by plastics king William Gatchalian. Wellex has explained this as a purely personal transaction. Is it? PSE president Francis Ed Lim and chairman Barin and their investigators are more in a position to make a proper judgment.

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Gatchalian is the majority stockholder of a number of listed corporations. One of these is Philippine Estates Corp. (PEC), which is in the middle of an Iloilo controversy over a flood control project. PEC is among the owners who want a mind-boggling P2.5 billion for about 10 hectares of expropriated land. It reportedly has the biggest compensation demand, at a sum higher than the entire Philippine government’s counterpart fund or investment in the P4.2-billion project!

There is another firm that links these two gentlemen—Strategic Alliance Development Corp, which has been facing a slew of suits.  Stradec is also facing several cases from irate partners for the delay in some projects, including those involving work with companies doing joint ventures with yet another listed firm, the Philippine National Construction Corp. (PNCC).

Quiambao and Gatchalian were partners in the failed bidding for PNCC six years ago. Gatchalian came into the consortium via a Korean partner. Now Gatchalian is leading Stradec’s legal charge against PNCC’s P6-billion compromise agreement with Radstock Securities Ltd. That agreement involves settlement in kind representing a third of a P17-billion debt already ruled as legitimate by the lower court. The case is now pending resolution by the Supreme Court after the Court of Appeals has ruled in favor of Radstock.

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With all these controversies, what happens to the sale by Stradec of 13,443,007,558 class A common Pacifica shares consisting of  1,782,590,000 fully paid shares and 11,660,417,558 partially paid shares? The block, equivalent to 33.61 percent of Pacifica’s outstanding shares, was sold to Multi-Tech Capital Inc. But a group of Stradec stockholders told Lim in a letter dated July 17, 2007 that as the controlling owners, “Yuico et all did not authorize any sale, conveyance or alienation of any share of Stradec in Pacifica Inc.”

The group said no less than the Supreme Court has recognized them as Stradec’s legitimate officers in upholding their election on March 1, 2004.

“For the record, it is also not true that Quiambao is the controlling stockholder of Stradec since the 20-percent shares, which would have otherwise qualified him as controlling stockholder of Stradec are subject of a case now pending before the Regional Trial Court of Pasig City ,” the Stradec stockholders told Lim.

DMCI Homes, the residential development arm of Consunji-led DMCI Holdings Inc., may go public next year.

Bayan to settle P240M in debts

BAYAN Telecommunications Inc., or Bayan, the phone company of the Lopez group, will settle P240 million in interest and a portion of its principal debt to creditors for the remaining months of the year, the company’s chief finance officer said Monday.

ONE of the nation’s premier non-sectarian universities has relaunched a business simulation competition called Virtual Business League, or VBL, to promote the ideals of entrepreneurship and teach students business tenets that are applicable to today’s business environment.

MINORITY shareholders of publicly-listed Philippine Racing Club Inc. (PRCI) wants the Securities and Exchange Commission (SEC) to probe reports that the Malaysian investors in the company may have exceeded the limits on foreign ownership, a violation of the Constitution and rules on corporate governance.

Philippine stocks fell Monday, extending the key index’s worst decline in four months, on concern a housing slump in the US will dent spending in the nation’s biggest overseas market and cool demand for riskier assets.