Time for PCGG to review legal strategies vs sequestered companies

Emeterio Sd. Perez

Emeterio Sd. Perez

GOING AFTER ROMUALDEZ. Former Ambassador Benjamin Trinidad “Kokoy” Romualdez” owned Palm Avenue Holdings Co. Inc. and Palm Avenue Realty and Development Corp. He was also identified as a crony – a much abused word during the administration of the late President Corazon Cojuangco-Aquino – of former President Ferdinand Marcos” and “the beneficial owner of the Benguet Corp. shares in the Palm Companies’ name,” according to the Supreme Court.

Because he was a Marcos associate, Romualdez has been deemed by the first Aquino Administration in 1986 to have acquired his wealth illegally. Thus, Aquino the mother, targeted him and many others for investigation in her search for their hidden wealth.

To be able to go after Romualdez and company, Mrs. Aquino formed the Presidential Commission on Good Government (PCGG) as her Administration’s arm to go after the assets of Marcos and his close associates. Among these associates was Romualdez.

PALM GROUP. With the death of Kokoy Romualdez (September 24, 1930—February 21, 2012) at the age of 81, the two Palm companies were handed down to members of his family as his heirs.

But while the holdings of Palm companies in Benguet Corp. remain intact, the Romualdezes have been engaged in a legal battle to protect their ownership of the two firms and their assets. The fight lasted 28 years from 1986 until recently when the government lost its case against Romualdez.

Due Diligencer would credit the victory to the perseverance of the family to engage the government, specifically the PCGG in a protracted litigation.

The Romualdezes did not give up after the Supreme Court ruled on August 31, 1987 against them in their bid to stop the sale of 16,237,339 Benguet shares held by their Palm companies. At P56 per share back in 1987, the Benguet shares owned by the Romualdez patriarch were worth P909.291 million.

VINDICATION. Then came the decision of the Supreme Court that spelled vindication for the Romualdezes, especially the father. In a ruling promulgated on August 6, 2014, the High Court reversed and set aside the resolutions of the Sandiganbayan on January 10, 2003 and June 14, 2006 allowing the PCGG to include the two Palm companies in the government suit to take control of 16,237,339 Benguet shares.

At the same time, the SC ordered the lifting of “the writ of sequestration against the assets and properties” of the two Palm Avenue companies. It also denied PCGG’s petition seeking the nullification of the Sandiganbayan resolution allowing the Romualdezes to regain control of Benguet.

In short, the government lost one of the biggest sequestration cases that it filed against an ally of the late President Marcos. Time for PCGG lawyers to review their legal strategies by reading the SC’s ruling against them.

PALM AVENUES TODAY.  In an ownership filing it posted on the website of the Philippine Stock Exchange, Benguet Corp. said the two Palm Avenue companies own a total of 68.02 million common A and B shares, or 34.874 percent of 195.043 million outstanding common shares divided into 117.429 million A shares and 77.614 million B shares. At a 52-week high of P12.70 per share and a low of P6.20, the block was worth P863.854 million and P421.724 million, respectively.

As in the past years, Benguet Corp. remains profitable. It reported net profit of P227.146 million in the first six months of 2014 against P36.559 million in 2013. These profits, which translate to earnings per share of P1.28 and P0.21, resulted from revenues of P2.347 billion and P1.259 billion during the two comparative periods.

In the last three years, Benguet registered net profit of P7.669 billion in 2013; P640.148 million in 2012; and P1.385 billion in 2011. As of December 31, 2013, it had retained earnings of P1.615 billion.

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Here is the complete item on “Insiders’ trades,” some lines of which were missing from Monday’s piece:

INSIDERS’ TRADES. On August 11, 2014, Lily Ngo Chua, a member of the board of JG Summit Holdings Inc. (JGS), sold 74,203,757 JGS shares at P53 each for total proceeds of P3,932,799,121. After the sale, she still owns 388,018 shares, as of August 31, 2014. She is the sister of businessman John Gokongwei Jr., JG Summit chairman.

On August 27, 2014, Gerardo Ablaza Jr., a senior managing director of Ayala Corp. (AC), availed of the executive stock option plan (ESOP) of the Zobel-controlled holding company by paying P11.755 million for 44,517 AC shares at the ESOP price of P264.06 each. Computed at Friday’s last traded price of P708 per share, his newly acquired AC shares had a market value of P31.518 million. Ablaza would be ahead by P19.763 million, that is, in paper value.

On September 3, 2014, Arthur Tan, also an AC senior managing director, sold 4,000 of his ESOP shares at P710 for gross proceeds of P2.84 million. If he had acquired the AC shares at P264.06, he would have paid P1.056 million, giving him a paper gain of P1.784 million.



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