Still buying. The number of shares owned by San Miguel Corp. Retirement Plan (SMCRP) in San Miguel Corp. (SMC) increased to 564,874,101 shares consisting of 411,608,071 A shares and 153,266,030 B shares as of September 30, 2008 from 562,518,801 shares as of June 30, 2008. The reports show the pension plan bought additional 2,355,300 SMC shares in the third quarter, or from July 1-September 30, 2008.  Its present ownership represents 17.896 percent of SMC’s 3,156,373,877 outstanding shares posted on the web site of the Philippine Stock Exchange and which are divided into 1,920,658,655 A shares and 1,235,715,222 B shares. SMCRP’s holdings had market value of P34,610,586,191 at SMC’s 30-day high and P24,707,289,422 at its month’s low.

Company-financed acquisitions. SMC has been financing the continued acquisition by SMCRP of SMC own shares. In a report to regulators, SMC said its advances to SMCRP as of June 30, 2008 amounted to P41.224 billion.  The amount—which represents 64.411 percent of SMC’s trade and receivables of P64.001 billion—earns 6.5-percent interest per annum, according to SMC. SMC said its advances to SMCRP—which were subject to interest of 1 percent above applicable average three-month treasury rate on the Philippine Dealing System—amounted to P31.742 billion as of September 30, 2007, and P35.721 billion as of December 31, 2007, equivalent to 57.727 percent of P61.879-billion trade and other receivables.

Nondisclosure? The last filing made by Manila Electric Co. (Meralco) was posted on the PSE web site on October  3, 2008. In it, Meralco told regulators the sale of 2,545 Meralco shares at P56.50 each by Helen Tamayo de Guzman, vice president and comptroller on September 30, 2008. The sale reduced her holdings to 470 Meralco shares. So far, there was no disclosure on the offer made by (SMC) and Filinvest Development Corp. (FDC) to buy out the Lopezes from First Infrastructure Development Corp. (FPIDC), formerly City Resources Corp. If there was, then Due diligencer failed to exert enough efforts in finding the disclosure made by the two losing bidders for the Lopezes’s 98.1246-percent holdings in FPIDC, which eventually went to Metro Pacific Investments Corp.

Who should make the filing? The disclosure that SMC and FDC made their offer to acquire FPIDC from the Lopezes did not come from the PSE web site but from a press release dated October 3, 2008 and which was issued by Pete Ilagan, president of the National Association of Electricity Consumers for Reforms. If there was a serious offer made in writing, then it should have been properly disclosed to the Philippine Stock Exchange (PSE) and the Securities and Exchange Commission (SEC). Had the parties failed in complying with the rules on transparency, then the regulators should go after who should be answerable for the nondisclosure of material fact which could have affected the prices of FPIDC and of SMC and FDC, which are also both listed on the exchange. It is now up PSE and SEC to determine who should have made the proper filing.

Buying on credit. In his statement, Ilagan wrote: “The Lopezes hurriedly sold to Metro Pacific their stake in FPIDC despite better offers from SMC and Filinvest Development, leading observers to conclude that Metro Pac had pledged to immediately pay FPH.” The initials stand for First Philippine Holdings (FPH). As the issue is sensitive enough to affect the market, lawyer Francis Ed Lim, PSE president and chief executive officer, and SEC chairman Fe Barin may want to look for who has been remiss in informing them of the tenders made by SMC and FDC, which could have been joint-venture partners in operating the North Luzon Expressway. The officials of the two “unsuccessful bidders” may also want to disclose how Ilagan learned that they wanted to buyout the Lopezes on credit and where they would eventually get the money. In the case of SMC, it has been using its pension plan in buying SMC shares in the open market using SMC’s own corporate funds.

EIGHT directors of Philex Mining Corp. want the recall of Social Security System (SSS) president and chief executive officer Romulo Neri in the board for violating his fiduciary duties.

Ayala group opposes taxes on telcos

JAIME Augusto Zobel de Ayala II, chairman of the country’s oldest conglomerate Ayala Corp., is strongly objecting the proposals of some lawmakers to impose new levies on telecommunication companies, saying the sector is already heavily taxed.

Hitachi unit expands operations in Subic

SUBIC BAY FREEPORT—Hitachi Terminals Mechatronics (Philippines) Corp. (HTMP), one of the biggest exporters in this free port, said it is expanding its operations as it still expects growth in the market for its industrial electronics products worldwide.

First Gen expects to pay off loans

POWER-generation giant First Gen Corp.  is confident that it would be able to pay off its $400-million maturing debt next month considering the number of options it has under its sleeves.

Appeals court junks SkyCable petition

THE Court of Appeals (CA) has dismissed for lack of merit the petition of Central CATV, operator of SkyCable, questioning the decision of the National Telecommunications Commission (NTC) that the Lopez-led firm has arbitrarily changed the channel positions of television stations.

Due Diligencer: Still buying.