Araneta, ATR-Kim Eng feud heats up

The ongoing squabble between ATR Kim Eng Financial Corp. (ATRKE) and businessman Carlos Araneta is far from over.

This, after ATRKE filed a libel suit against Araneta and his lawyer Ronaldo Tugonon for the false and unfair accusations hurled against the listed financial holding company.

Araneta, through LBC Development Corp., has accused ATRKE of mismanagement, illegal use of TPG Corp.’s trust fund and violation of fiduciary responsibilities. ATR Kim Eng Capital Partners Inc., a wholly-owned subsidiary of ATRKE, manages the trust fund of pre-need firm TPG.

In a press briefing yesterday, ATRKE executive vice-president Renato Leveriza Jr. said the filing of the case was intended to "stop once and for all the false accusations that have been floating for the past few months against the company."

The allegations, he said, were "calculated to malign if not destroy the reputation of ATRKE and its directors and officers."

Leveriza said Araneta is resorting to this cheap ploy to avoid paying P353.25 million which is the exercise price of ATRKE’s option to put back to him the holding firm’s 10 percent ownership in LBC Global Corp. in Delaware in the United States.

Araneta alleged that without the consent of the TPG board, ATR Capital used P82.4 million of the fund to buy GE Life Co. in 2001 and another P1.079 million for an urban planning study and for a design of a building in a Davao City property. He claimed that these investments were made by ATRKE to the detriment of the fund.

But Leveriza defended the company’s move to invest in GE Life, saying it was a good investment as TPG obtained a P50-million profit from GE that eventually went to the trust fund. The shares in GE, he said, were sold at a good price, generating substantial capital gains and improving TPG fund’s liquidity on top of cash dividends earlier received.

In addition, Leveriza said ATRKE had been cleared by the Securities and Exchange Commission last March on allegations it engaged in misrepresentation by providing misleading information to the corporate watchdog.