Acquisitions of San Miguel questioned at Supreme Court

MANILA, Philippines - A group claiming rights over the coconut levy funds asked the Supreme Court yesterday to compel San Miguel Corp. (SMC) to reveal whether these funds were used to purchase shares in the Manila Electric Co. and Petron Corp. and other recent acquisitions.

Spearheading the petition were the Multi-Sectoral Task Force on the Coco Levy Recovery, and former senators Jovito Salonga and Wigberto Tañada.

The petitioners asked the SC to order SMC to submit complete documents related to the acquisitions, including details on “funding sources and commitment in connection with the foregoing transactions,” as well as the food and beverage giant’s business plans.

“It cannot be denied that much of the enjoyment or benefit to be derived from this right over the subject SMC shares, however, depends on whether or not, at the end of the day, and finally, when the moment of justice comes, the subject SMC shares still have value,” read the petition.

Records show the government seized 24 percent of shares of SMC in 1986 on suspicion that the they were acquired by President Ferdinand Marcos using coco levy funds.

The Sandiganbayan later on ruled that the stake belongs to the state, a decision that another group of farmers, the Philippine Coconut Producers Federation, Inc. (Cocofed), has disputed before the SC.

The Multi-Sectoral Task Force on the Coco Levy Recovery also questioned the membership of Cocofed on grounds that it is indirectly related to the Cojuangco conglomerate.

In the petition, the group said the government has admitted that the value of the coconut levy funds has reached an “all-time low.”

“With all the foregoing indicators, the series of forays of SMC into several non-allied and non-core undertakings… one is left to wonder, what is the impact of all these to the hope of millions of coconut farmers pinned on a commanding value of the subject SMC shares,” read the petition.

The value of the funds is now P21 billion, down from the original valuation of P54 billion, according to Finance Secretary Margarito Teves.

SMC has announced it has sold 43.249 percent of its brewing unit, San Miguel Brewery, Inc., to Kirin Holdings Co., Ltd.

The share purchase agreement would be used to bankroll its diversification into other industries, the firm added.

SMC also bought a substantial stake in Meralco and Petron Corp. and has tied up with Qatar Telecom for a telecoms venture. It has also been reported that it will venture into the water industry via the Laiban Dam Project.

The Presidential Commission on Good Government has not demanded from SMC any explanation of its business plans, according to the Multi-Sectoral Task Force on the Coco Levy Recovery.

“Petitioners-intervenors need to know for themselves amid an apparent silence, even collusion, between the government and those that control SMC,” read the petition.

“(We) need to know and understand what all these business forays mean for their future and their hope of obtaining justice.”   – Edu Punay