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Reflections

“How shall freedom be defended? By arms when it is attacked by arms, by truth when it is attacked by lies, by faith when it is attacked by authoritarian dogma. Always, in the final act, by determination and faith.”

― Archibald MacLeish

Sunday, September 30, 2012

Understanding The Manny Pangilinan-Ramon Ang Rivalry

The Manny Pangilinan-Ramon Ang Monopoly Games
MVPangilinan: The Salim Point Guard In The Philippines
Manuel V. Pangilinan (born July 14, 1946 in Manila), also known as MVP to associates and media, is the chairman of the Philippine Long Distance Telephone Company from 1990 up to the present, chairman of TV5 from 2009 to present and CEO of Hong Kong-listed First Pacific Company, Ltd.

He worked with Crown Colony where he met well-connected clients (who eventually became his friends) and learned the dynamics of international finance. Among those he befriended was Anthoni Salim, son of the Indonesian billionaire Liem Sioe Liong. They shared the idea of putting up a regional banking and trading business.    
Pangilinan admitted to plagiarizing his commencement speech for Ateneo de Manila University's 2010 graduating class. In his letter, Pangilinan apologized to delivering a speech that was “borrowed from certain other graduation speeches.” He also offered to resign from his post as chairman of Ateneo's board of trustees as his term will not end until 2011.From WikiPilipinas
 
MVP's Boss:Anthoni Salim
Father, Liem Sioe Liong, built family's Salim Group into food, shipping, bank and building empire. Now Anthoni heads family's Indofood, world's largest instant noodle maker by sales.From Forbes
3) First Pacific
First Pacific (HKEx: 00142) is a Hong Kong-based investment and management company with operations located in Asia. Its principal business interests relate to Telecommunications, Infrastructure, Consumer Food Products and Natural Resources. From First Pacific Website

Principal Investments In The Philippines:


Philippine Long Distance Telephone Company (PSE: TEL; NYSE: PHI) is the leading telecommunications service provider in the Philippines. It has one of the largest market capitalizations among Philippine listed companies.

Metro Pacific Investments Corporation (MPIC) (PSE: MPI) is a Philippine-based, publicly-listed, investment and management company with holdings in water distribution, tollroads, power distribution, healthcare and port development.

MPIC's  key strategic investments in Maynilad Water Services, Inc., Metro Pacific Tollways Corporation, Makati Medical Center, Cardinal Santos Medical Center and Davao Doctors Hospital have placed Metro Pacific Investments Corporation in the forefront of infrastructure. From Metro Pacific Website
 
Meralco: Philippine Long Distance Telephone Co. and Metro Pacific Investments Corp. now control more than 40 percent of Meralco shares.

TV 5: MediaQuest Holdings Inc., which controls ABC TV-5.

Inquirer: Associated Broadcasting Company (ABC), which owns TV5 and other stations, has bought a 10% stake in the Inquirer. From Inquirer

  Sudono Salim (Liem Sioe Liong)
The SALIM Group:
The Salim Group is Indonesia's biggest conglomerate with assets including Indofood Sukses Makmur, the world's largest instant noodle producer, and Bogasari, a large flour-milling operation [1]. The group was founded by Sudono Salim. The Salim Group also owns major oil palm plantations (about 1,000 km²) and logging concessions.   FromWikipedia

Backgrounder:

Days of plunder
By LEE HAN SHIH

There are many who practise crony capitalism — getting economic gains by toadying up to the powers that be — but few, if any, match the scale of Liem Sioe Liong.

When angry mobs in Jakarta broke into Liem’s house and burnt his painting in effigy in 1998, the bald man who arrived penniless in Indonesia 60 years ago was worth, conservatively, US$15 billion. That was the estimate of Forbes. The Central Intelligence Agency placed it to be at least US$30 billion.
As Bill Gates and Warren Buffet have shown, it is possible to make a fortune of US$30 billion. You can do it by selling software or be the best investor the world has seen. Or you can invest in a general.
Liem did, on an unknown lieutenant colonel called Suharto in the 1950s. Suharto, in command of the Central Java Division, was dismissed from this post in 1956. But backed by Liem, he manoeuvered his way up the ranks during the struggle for independence against the Dutch, and eventually deposed President Sukarno to become the second head of state of the fledging nation of Indonesia.
Liem reaped his reward by getting monopolies or dominant positions in key markets. Those who got in his way, such as the Prima group in flour milling, were shunted to smaller niches or eradicated. It was a win-win situation for Suharto and Liem, though a losing proposition for the vast population of Indonesia.
Suharto was comfortable using Liem and other Chinese (such as Bob Hasan) because as minorities they could never replace him. And his family also benefited greatly from these Chinese, by having a finger in every pie they engaged in, which covered just about everything in the country.
In Liem’s heyday in the mid-1990s, his Salim Group controlled 90% of Indonesia’s instant noodles market, 85% of its flour market, 35% of its dairy market and more than 30% of its edible oil market, just to name a few. Salim was also in banking, cement, petrochemicals, telecommunications, clove imports (the indispensable ingredient for the type of cigarette favoured by Indonesians), and many other businesses.
The Salim fortune was in ascendance for most of Suharto’s reign. But resentment became rampant after deregulation in the 1980s revealed how much the Chinese tycoons had made from the people via their privileged positions. A cosmetic exercise by the president to ask the tycoons to hand over 25% of their wealth to co-operatives only alarmed foreign investors and led to a flow of money out of the country. The handful of tycoons, already accused of many things by the Indonesians, found that they were also guilty of triggering and masterminding capital flight.
The Asian Financial Crisis of 1997/98 led to a blow-up of Indonesia that threw Suharto out of power. It also deprived Liem of his backer. It is not that crony capitalism has disappeared from Indonesia; if anything it is as strong as before. But Liem’s days as the top crony has passed. Newer faces, some Chinese and other indigenous Indonesians, have replaced him and his son and heir apparent Anthony Salim. Liem, 92 this year, spends most of his time outside of Indonesia, in Singapore and elsewhere. Anthony’s eyes have turned west and are focusing on India. Perhaps he can find some clones of Suharto there willing to give him his dues.

Why Is The San Miguel "Ownership" So Controversial ?
“People keep on shouting the transparency issue because our competitors and copycats keep pushing us to divulge what we will buy and what we will do,” he says. “It’s driven by envy.”  
Ramon S.Ang

 MANILA, Philippines — Industrialist Eduardo “Danding” Cojuangco Jr. sold his 11 percent holdings in San Miguel Corporation (SMC) to the company’s President and Chief Operating Officer Ramon S. Ang through a cross sale at the Philippine Stock Exchange (PSE), valued at roughly P27.6 billion. 
With the sale, Ang  now owns the company’s biggest single bloc of shares.
In a disclosure to the PSE, Cojuangco, SMC chairman and CEO, said he is assigning his 11 percent stake, equivalent to 368.140 million shares, in the diversifying conglomerate to Ang at a friendly price of P75 per share.
The shares were granted to Top Frontier (TF), an investment firm of which 49 percent is controlled by SMC through an option agreement purchase in 2009.
However, TF partially waived its option to exercise the option. The price of the share under the option agreement with TF was pegged at P75, which is P39 lower than the prevailing SMC market price of P114 per share.
Cojuangco said he sold his shares to Ang, whom he described as “a person in whom I have full trust and confidence and rightfully deserves utmost recognition for transforming the Company into a highly diversified and profitable business conglomerate.”
“Mr. Cojuangco offered the balance of the Option shares to me and I accepted primarily for the following reasons: the San Miguel vision set by management during my term is far from being achieved, and; I have an obligation to ECJ, the company’s stakeholders and the employees to see through the realization of this vision,” Ang said.
The 78-year-old Cojuangco, on the other hand, added “from the time I requested Ramon to join me in the company, he has continuously dedicated one hundred percent of his time and effort in ensuring the growth of the San Miguel Group to the benefit of its shareholders”.
Ang has been credited for San Miguel’s bold diversification strategy which reinvented the company from a conservative food, beverage and packaging firm into a highly-diversified and dynamic conglomerate with interests in vital industries such as power, fuel and oil, infrastructure, mining, telecommunications, airlines, airports, among others– businesses which promise to bring in revenues amounting to about P1 trillion to the group by 2013.
“There is no other person deserving of this opportunity to control a significant stake in the Company that is so close to my heart, than Ramon. San Miguel has made a distinctive impact because of him and he cares about this company and its people. I am confident he will lead this Company to further greatness,” Cojuangco said.
Cojuangco, who remains as chairman and CEO, added, “With Ramon at the helm, I now have the luxury of devoting more time for my personal endeavor, though I will continue to oversee and participate in the unending commitments of SMC to make everyday life a celebration, maintain business excellence, further enhance shareholder value, and become a partner in the country’s growth story.”
Cojuangco said he is passing control to a trusted friend on friendly terms.
The Supreme Court had earlier declared Cojuangco as the true owner of the San Miguel shares after several years of disputes. From Manila Bulletin
Who is Roberto Ongpin Fronting For In SMC? 
MANILA, Philippines—A group led by San Miguel Corp. president Ramon Ang and former Trade Minister Roberto V. Ongpin has completed the consolidation of the single biggest voting bloc in SMC into Top Frontier Investments Holdings Inc., which now owns 47.5 percent of the diversifying conglomerate.
San Miguel announced that Top Frontier acquired on Wednesday the remaining stake in SMC held by Q-Tech Alliance Holdings, completing the former’s buyout of a 20-percent block of shares.
Q-Tech sold its remaining 301.6 million shares in SMC to New Frontier at P70 a share for a total block price of about P21.1 billion. The shares were crossed at the Philippine Stock Exchange Wednesday.
Top Frontier is 49-percent owned by SMC itself as represented by Ang while 51 percent is controlled by an investor group that includes Ongpin, his nephew Eric Recto (who is also president of Petron Corp.) and businessmen IƱigo Zobel and Joselito Campos.

What is the real SMC strategy?
Under their reign, Cojuangco and Ang have been on an international “Buying And Selling ” spree for San Miguel.
Can You Guess Why?