Active year

2008 was indeed a very active year for Hongkong-based First Pacific Co., parent to telecommunications giant Philippine Long Distance Telephone Co. (PLDT) and infrastructure and healthcare bigwig Metro Pacific Investments Corp. (MPIC).

According to First Pacific managing director Manny Pangilinan, the conglomerate expanded its asset portfolio by investing over $1 billion last year by way of acquisition or increased shareholdings across its portfolio of natural resources, infrastructure and consumer products.

In the Philippines, First Pacific made its initial investment in the mining sector via a 20-percent stake in Philex Mining. MPIC also increased its effective interest in Maynilad to 57 percent and concluded its equity investments in Metro Pacific Tollways Corp., Medical Doctors Inc., and Davao Doctors Hospital.

According to Pangilinan, they are very pleased that PLDT, MPIC and Indonesia-based Indofood reported solid performances last year. He noted that while the combined effects of higher fuel and food prices in the first half of 2008 and falling purchasing power and lower commodity prices in the second half posed significant challenges to their businesses, their competitive strength and diversity enabled them to sustain their operational performance level for the year.

Pangilinan says he believes that these investments significantly enhance the value of their asset portfolio for long-term value creation.

In fact, First Pacific’s investments are already paying off. PLDT’s profit contribution of $211 million last year already represented 69 percent of First Pacific’s aggregate attributable net profit from the operations of subsidiaries and associated companies for 2008.

In 2008, MPIC invested a total of P22.3 billion to expand its core business portfolio with the view to becoming the leading infrastructure group in the country.

Following the acquisition by the PLDT Beneficial Trust Fund (BTF) and Pilipino Telephone Inc. (Piltel) of stakes in Meralco and MPIC’s plan to acquire BTF’s Meralco stake, First Pacific said it believes that there is significant potential in the value of Meralco as its business develops along with the growth of the Philippine economy. It added that First Pacific will benefit from the synergies which can be realized between PLDT and the infrastructure assets owned by MPIC, including potentially, Meralco.

For his part, Pangilinan emphasized that the investments made over the last few years position the group for further growth in 2009, despite the pessimistic outlook for the global economy and the challenges that each of their business face in their respective markets.

But of course, we haven’t seen the end of First Pacific’s investment spree. Pangilinan has said MPIC is open to owning more shares in Meralco. Meanwhile, PLDT is in talks with telcos both in the Philippines and in the region for possible acquisition or investment.

While most have chosen to adopt a wait-and-see attitude in light of the global economic and financial debacle, Pangilinan believes now is the time to invest in the future.

Doing it right again

For the fourth consecutive year, Security Bank Corporation (SBC) was awarded Best Securities House at the 2009 Philippine Dealing System Awards Night held just recently. The bank, in fact, bagged multiple awards as it garnered the highest volume in trading of government securities in all of 2008.

SBC was given recognition as the country’s Top Fixed-Income Dealing Participant — a grand slam win of four years in a row, Top Fixed-Income Brokering Participant, Top Fixed-Income Cash Settlement Bank and Best Securities House for 2008. The bank also ranked 3rd among the top Foreign Exchange Dealers in the Philippines.

In our book, the said awards underscore Security Bank’s corporate leadership status as a universal bank in the Philippine banking arena, besting its more formidable banking competitors.

But while such achievement s and accolades are commendable, it is no longer surprising. Just recently, SBC practically defied the gravitational pull of the current global financial contagion by maintaining its pre-eminence and leadership in the banking industry in reporting 19.3 percent return on equity (ROE) for 2008 thus sustaining exemplary shareholder value when compared against the entire banking industry.

Abet Villarosa, the bank’s president, acknowledged the period of challenges for businesses across the board while explaining efforts exerted in building core revenues and other income streams helped soften the adverse impact on securities markets brought about the global financial turmoil that began in the US and Europe.”

Filipino brand

Publicly listed Solid Group, which gave to us the country’s only Filipino brand of mobile phones and popularized dual active SIM cellular phones here, is spinning off its mobile phone, LCD television, and digital devices business to a still-to-be-incorporated wholly owned subsidiary My Solid Technologies and Devices Corp. that will have an authorized capitalization of P100 million.

This new company will also be engaged in the manufacture, sale, distribution, and importation of various kinds of digital communication devices, information technology, broadband and audio-video equipment, gadgets and accessories, as well as undertake product research and development.

Following the resounding success of its My Phone and My TV brands, Solid Group president David Lim says they are planning to bring in other devices and gadgets, including very affordable laptops. Not known to many, David’s family owns China’s second biggest mobile phone brand Amoy. Their factory in China makes phones for other brands too.

Very low key like its owners, Solid Group’s Destiny brand of cable television service has also been able to create and retain its own very loyal set of subscribers.

Building brands is not new to the Lims. Their family built the Sony brand in the Philippines. They are doing it again with My Phone and My TV, and very soon, other Filipino brands.

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