PCGG ready to field questions on San Miguel diversification

MANILA, Philippines - Presidential Commission on Good Government (PCGG) chairman Camilo Sabio said yesterday he and other officials are ready to appear before Congress to answer questions on the diversification moves by San Miguel Corp. (SMC).

The government now has a 27-percent stake in the conglomerate, enough to monitor “to some extent” the decision-making process in SMC.

Sabio, in a phone interview, said that they would obey any summons that would be issued by Congress and do their best to answer questions of congressmen.

By virtue of its 27 percent stake in SMC, the PCGG has nominated to the SMC board of directors broadcast executive Menardo Jimenez; industrialist Egmidio Jose; former Presidential Security Group (PSG) head Leo Alvez; former Nueva Ecija congressman Pacifico Fajardo, father of the deputy presidential spokesperson Lorelei Fajardo; and former justice secretary Silvestre Bello III.

But the PCGG said it would not interfere in the management of SMC and would leave it to the directors to guard the government’s interest in the conglomerate.

The government nominees have long supported businessman Eduardo Cojuangco Jr. in his management of the food and beverage giant, with the support continuing during the time of the late PCGG chair Haydee Yorac.

Cojuangco returned to the SMC top post during the time of former President Joseph Estrada in 1998. Estrada was Cojuangco’s vice presidential running mate in 1992.

The Supreme Court has declared the 27-percent SMC stake sequestered by the PCGG as “imbued with public interest” and bought with prima facie public funds.

The PCGG is awaiting final judgment from the Sandiganbayan forfeiting the 27-percent stake in favor of the government that would clear the way for government’s sale of the shares in a public bidding.

The PCGG is also pursuing its claim of another 20 percent of SMC being claimed by Cojuangco.

Lawmakers have questioned the SMC’s recent string of investments outside its core business of food and beverage manufacturing.

After spinning off its brewery business through San Miguel Brewery, SMC had announced its intent to diversify into growth industries such as power, energy and mining.

San Miguel recently bought the 27-percent stake of the Government Service Insurance System in the Manila Electric Co. reportedly for P27 billion.

San Miguel had also bought a controlling stake in Petron Corp. from British investment firm Ashmore, reportedly for some P33 billion or $660 million.

Recently, SMC had also bought a controlling stake in Liberty Telecom Holdings.