ROBERTO Ongpin is chairman of Philweb Corp., which is listed on the Philippine Stock Exchange. He owns 758,179,396 Philweb shares with market value of P7,392,249,111 computed at P9.75 per share the stock’s closing price on Dec. 29.
Philweb makes Mr. Ongpin a very rich man. The dividends of P0.40 per share last year grossed him P303,271,758, which represents a return of 4.102 percent of the market value of his holdings.
Mr. Ongpin is also one of the five highest paid executives, who received P41,453,269 in salary in 2012 and 2013 plus pays and perks of P8,685,517 and other incentives of P2,060,429. That’s a total of P52,199,215 for the group in two years.
Now you know why certain people and corrupt politicians hate and envy Mr. Ongpin.
Tender or buyback?
Paging Jose Carillo. This is for your English Language Forum.
Due Diligencer is rather confused by the continued use of “tender offer” on shares of listed companies. “Tender” as I understand the word already means “offer” and to use both words in buying shares in the open market would be redundant.
Anyway, ISM Communications Corp. posted on PSE website a tender to buy (it used tender offer) 1.2 billion ISM shares at P1.52 per share. It started the offer on Dec.15, 2014 and will end on Jan. 20, 2015 at a total cost of P1.824 billion.
There is no question about the company’s ability to make the tender since it has in its books retained earnings of P1.927 billion.
The confusion would result from the offer itself of the issuer to buy its own shares. Is this not tantamount to a buyback?
If ISM Communication, however, is making the tender on behalf of an existing stockholder, it should say so in the filing. Otherwise, it could mislead the public into believing that all 1.2 billion shares that it is buying would end up as treasury shares in the books.
Here is the possible scenario if ISM Communication is actually reacquiring its own shares:
ISM Communication has 1,916,216,149 outstanding shares. The buyback of 1.2 billion shares would reduce the company’s outstanding shares to 716,216,149 shares. The market price of ISM shares would surely jump on such corporate move that would make Mr. Ongpin even richer and his nephews very rich like him.
For estate tax purposes
Preparing the estate of a deceased for tax purposes takes a lot of paper work to meet the requirements of the Bureau of Internal Revenue. If the deceased owned shares of stocks, his heirs had to get a certification on the market value of his holdings as of the date he died.
In case of listed companies, the heirs need not worry in getting certificates of the market value of the shares. They should trust the efficiency of the personnel of the Philippine Stock Exchange who understand the urgency of attending to them. The exchange’s management knows that these certificates are for estate tax purposes.
I had experienced before the long Christmas holidays how easy it was to deal with PSE people. In less than two hours, I went home with the certificate of the market value of a deceased member of the family.
For this, I am grateful to the PSE leadership for the efficiency of their people.
By the way, I still have to go back to the Philippine Veterans Bank (PVB) in Makati City to follow up my request for the book value of the bank’s shares of stock for purposes of determining the taxes due on the shares owned by a deceased stockholder.
Hopefully, PVB would be ready with the certificates when I go back to its offices anytime today.