|
THE
Lopez-led consortium that now owns PNOC-Energy
Development Corp. (PNOC-EDC), formerly a
government-owned corporation, should teach Guilt
Holdings Inc. a lesson on legal corporate takeover.
Guilt is only a suggested corporate name for
incorporation with the Securities and Exchange
Commission (SEC), possibly by former Sen. Teofisto
Guingona Jr., Danilo Lim, a general, and Antonio
Trillanes IV, who is not yet a general like Lim, and
their co-conspirators in staging a short-lived and
unsuccessful coup. Why don’t they look at how Red Vulcan
Holdings and other conglomerates legally acquire
majority ownership of a corporation?
Never
mind if they would not want or would not be willing to
take an informal course on corporate takeover, which
they actually did demonstrate they could, though
unsuccessfully, when they forcefully occupied a portion
of Manila Peninsula on November 29, 2007, from the
masters. By imposing its will on the hotel management
and guests, a failed strategy in seeking the resignation
of President Arroyo, Guilt had given businesses a
preview of what’s in store for them should a military
takeover, with the aid of some Catholic leaders, occur
with Guingona-Lim-Trillanes triumvirate in power. This
was the message they—either knowingly or unknowingly—had
put across when their presence in Manila Pen sent away
their guests for safer hotels outside Makati City.
Although
Guingona, Lim and Trillanes might not want an imposition
from others, here are some lessons on takeover,
corporate, not military.
Lesson
1.
You need money. Red Vulcan Holdings, the corporate
vehicle used by the Lopezes in acquiring 60 percent of
EDC’s outstanding shares, joined the bidding, beating
the other interested buyers with their biggest offer of
P58.5 billion. What followed was the resignation of the
incumbent members of the board of directors who gave way
to the nominees of the new owners. In a filing, EDC said
the new board is now composed of Oscar M. Lopez, Peter
D. Garrucho Jr., Richard B. Tantoco, Francis Giles B.
Puno, Federico Lopez, Ernesto B. Pantangco and Jonathan
C. Russel.
The
election—appointment would be the more appropriate
word—of the nominees of Red Vulcan Holdings to the EDC
board went on smoothly and did not meet any kind of
opposition. Will the same peaceful transfer of ownership
and management of EDC happen to Guilt should it elect
its board, which, in turn, would be tasked to appoint
its executive officers? Guingona might want to become
chairman but might end up the chairman emeritus, an
honorary title that belongs to retired company owners
like John Gokongwei Jr., who still sits in the board of
JG Summit Holdings Inc. with that title. The
chairmanship of the board might go to Lim, being the
general, who would nominate Trillanes for president with
additional title of chief executive officer. Unless, of
course, Trillanes would appropriate all the titles to
himself. Certain leaders of the Catholic bishops Julio
Labayen and Antonio Tobias might want to know that a
corporation, even if its shares are publicly traded,
does not need a chaplain. But lawyers Argee Guevarra and
Jose Virgilio Bautista would want to assume the post as
corporate secretary and assistant corporate secretary.
It’s up to them to decide who will be the boss between
them.
Lesson
2.
Incorporate. A conglomerate or an individual but very
rich businessman who has taken over a company uses a
corporate vehicle, such as a holding company, when
running a group of companies with several subsidiaries.
Red Vulcan Holdings was incorporated with the SEC to
become the bidding company for the Lopez group. It is
now the controlling stockholder of EDC, which is
undertaking several ventures as a unit of the
government-owned Philippine National Oil Co. Probably,
Guilt would be a good one for an identity as the name
itself would send a signal to government men that it is
now time to feel the guilt and be repentant for their
alleged corruption. (Of course, Joseph Estrada, the
president of Guingona, Lim and Trillanes, had been
pardoned after having been convicted for the serious
crime of plunder but had not demonstrated any remorse
because he claimed he was innocent of the plunder
charges against him.)
Lesson
No. 3.Go
public. Guilt may also want to adopt the corporate
strategy implemented by Vista Land and Landscapes Inc.
in getting on the PSE’s first board. First, it made a
deal with the majority stockholders of C&P Homes Inc., a
listed company. The deal involved the 1:1 swap of C&P
outstanding shares with Vista Land shares. Since Vista
Land was incorporated primarily for the share swap and,
like C&P, is also owned by the family of Senate
President Manuel Villar, the transfer of shares held by
majority stockholders from one company to another was
easy. It was also easy to convince C&P minority
stockholders that if they would not tender their
holdings, they would be left in the cold owning C&P
shares without a market with the listing of Vista Land
and delisting of C&P Homes.
Guilt
can do the tender offer for the shares of a listed but
inactive company of which PSE has many. The question is,
will the owners agree to exchange their holdings with
those of an entity controlled by military? In corporate
Philippines, money talks. In the stock market, two Cs
are the main ingredients of a tender offer. These are
cash for buyouts and credibility for stock swaps.
www.duediligencer.com |
