|
By Likha Cuevas-Miel, Reporter
The intervention of the Securities and Exchange
Commission (SEC) in the boardroom battle for the Manila Electric Co.
(Meralco) may scare away investors from the Philippines, analysts
said Tuesday.
On the sidelines of the Meralco stockholders’
meeting, Francisco Liboro, PCCI Securities Brokers Corp., said
SEC’s move to disqualify the proxy votes of the small and foreign
investors abroad will leave “disenfranchised ballots abroad” and
would reflect badly on Philippine corporations as a whole.
During the first hour of the 10-hour plus
stockholders’ meeting Tuesday, Hubert Dominic Guevara, SEC
director of the compliance and enforcement department, served the
Lopez-controlled Meralco board a cease and desist order.
The order, which was signed by Commissioner
Jesus Enrique Martinez, was issued based on a petition filed by the
Government Service Insurance System (GSIS), whose president, Winston
Garcia, wants the Lopezes out of Meralco management.
The order restrains lawyer Anthony Rosete,
Meralco’s acting corporate secretary—and any person acting on
his behalf—from counting and tabulating the proxies solicited from
the public in favor of the Lopezes during the stockholders’
meeting.
The SEC order cited that the proxy votes
solicited by Manuel Lopez, Felipe Alfonso, Jesus Francisco,
Christian Monsod, Elpidio Ibañez and Francisco Giles Puno—all of
whom were candidates for board of directors and were nominated by
management —should not be counted as these are “challenged
shares.”
In lieu of a corporate secretary, the SEC
authorized Guevara and two of his lawyers as the regulator’s
representatives to supervise the stockholders’ meeting “with
full powers and authority to ensure the holding of credible,
transparent and peaceful election of directors” for yesterday’s
meeting.
Consequences
Liboro said the SEC intervention is a dangerous
precedent and “creates discontent on foreign investors. This has
to be resolved by the SEC and courts as soon as possible.”
Astro del Castillo, First Grade Holdings Inc.
managing director, said the GSIS-Meralco issue “will drag on,”
so they have to find a middle ground, since both camps have valid
grievances. Meralco, he added, faces a “triple whammy” –
uncertainties about who will control management, regulatory
challenges imposed by the Energy Regulatory Commission (ERC), and
market sentiments about high rates.
The fight for control of Meralco is driving down
the price of its stock, making it difficult for shareholders to exit
by selling their shares, del Castillo said.
According to the analyst, Meralco shares on
Tuesday closed flat at P63 per share, but went down to P62.50 during
midday trading when the SEC served the cease and desist order.
The proxy votes of foreign shareholders of
Meralco “show they don’t want a government takeover,” said
Liboro, who suggested that it will be better if the two camps can
settle their dispute in the court.
Silent minority
Jomar Lacson, research head of Campos, Lanuza
and Co., said serving the cease and desist order “was really
rough” and what transpired during the meeting “wasn’t really
fair,” since the proceedings were “railroaded.”
“It does not speak very well for Meralco,”
he added.
Many minority shareholders were not given a
chance to speak during the Tuesday meeting, when microphones were
turned off. “This puts evidence [to the world] that this is what
happens in the Philippines,” Lacson said.
Meralco shares could decline further because of
the uncertainty brought about by the GSIS-Lopez feud, he said.
|
