San Miguel deal yet to be endorsed

Manila, Dec 3: A deal on a contested 27 per cent stake in San Miguel Corp is closed, but the Philippine government has not yet endorsed the agreement, a spokesman for President Gloria Macapagal Arroyo said on Monday. Mr Rigoberto Tiglao said that Executive Secretary Alberto Romulo has not yet finalised a recommendation to Arroyo over the pact signed by coconut farmers and the private Philippine Coconut Producers Federation (Cocofed) over shares in San Miguel, the country’s top food and beverage firm. “It hasn’t been elevated to the President. These proposals are being coursed through the executive secretary,” Mr Tiglao said. “All she said is that she is seeking a mechanism (to settle the ownership issue), but she hasn’t endorsed this particular proposal.”

San Miguel’s A and B shares ended Monday unchanged at 41.50 and 51.50 pesos respectively. The main index was down 2.07 per cent at 1,105.06 points on profit-taking. A total of 47 per cent of San Miguel’s shares have been sequestered by the government on suspicion the stock was purchased during the rule of late President Ferdinand Marcos with funds taken from coconut farmers through an illegal levy. Of this stake, 20 per cent is being claimed by San Miguel chairman Eduardo Cojuangco, who was given voting rights but no other control over the shares in a court decision in 1998.

The latest deal provides for the remaining 27 per cent San Miguel stake to be sold and the proceeds divided, 20 per cent going to Cocofed, 40 per cent to the farmers’ groups, 15 per cent to a coconut trust fund, and 25 per cent to the government. Cocofed originally maintained the 27 per cent stake was a private investment, and the government said it was publicly owned.

San Miguel said last week it had talked with several major brewers in the region to sell a strategic stake in the company, but did not say if this would be from the contested 27 per cent. A court battle between Cojuangco and the government for the other 20 per cent would be allowed to take its course, Mr Tiglao said. Mr Dante Ang, who describes himself as a personal aide of Arroyo, said in a statement in his Manila Times newspaper on Monday that he helped mediate between the coconut farmers and Cocofed to settle the ownership of the 27 per cent in San Miguel. Newspapers said at the weekend Arroyo favoured an out-of-court settlement on the ownership of the bloc of shares in San Miguel and that a compromise deal between Cocofed, the farmers and the government was nearly done.

— Reuters