Settlement not likely in Philseco issue

A settlement is not likely to emerge as the government awaits the decision of the Supreme Court on its appeals for the reconsideration of its ruling effectively awarding Philippine Shipyard Corp. (Philseco) to a Gokongwei-led consortium of shipyard developers.

The Privatization Management Office expressed concern over the possible impact of the Supreme Court ruling on the privatization of Philseco, but officials gave assurances that government has plugged enough of the loopholes to prevent a similar legal crisis in the future.

PMO chairman Renato Valdecantos said yesterday that no settlement was in sight but the government would abide by the ruling of the Supreme Court, no matter what the outcome.

It was hinted earlier that the Gokongwei group might be open to the possibility of renewing the settlement offer it made early on in the case before the SC made its November 2000 ruling in favor of the consortium.

Although it had already won the first round by getting Supreme Court to nullify the award of the shares to Philyard Holdings Inc., sources in the Gokongwei-led consortium earlier confirmed that it had not withdrawn its offer of settlement.

However, Valdecantos admitted that a final ruling in favor of the consortium would create problems for the PMO and what remains of the government assets lined up for privatization.

According to Valdecantos, the legal imbroglio surrounding the privatization of government’s 87-percent share in Philseco came at the time when the privatization program was in a frenzy, with several big ticket items on the auction block at any given time.

Valdecantos said the subsequent privatization process has been relatively trouble-free precisely because of the problems that cropped up during the early part of the program when government was only developing the rules and procedures.

The PMO’s only apprehension now is that how the Supreme Court ruling would affect the entire privatization program, Valdecantos said, adding that the solution had been to remain completely transparent where bidding of public assets were concerned.