PSE flip-flops on San Miguel disclosure penalties


Posted at Feb 11 2009 08:39 PM | Updated as of Feb 12 2009 10:31 PM

The Philippine Stock Exchange (PSE) has reversed its recent decision imposing a monetary penalty on diversified conglomerate San Miguel Corp. for its failure to disclose the date of the signing of the deal to acquire 27 percent of Manila Electric Co. (Meralco).

In a letter to San Miguel on Wednesday, Roy Joseph Rafols, head of PSE's issuer regulation division, said they have accepted San Miguel's explanation on the matter and granted its request for reconsideration.

Moreover, Rafols said the PSE has resolved not to penalize San Miguel for its delayed disclosure of the option agreement with SEA Refinery Holdings BV for the purchase of a majority stake in Petron Corp.

But Rafols reminded San Miguel to ensure prompt disclosures of "any material information or corporate act, development or event" in the future.

"The online disclosure system is capable of receiving disclosures 24 hours a day, 7 days a week, to ensure that listed companies are able to make prompt disclosures," said Rafols.

"The corporation is forewarned that a subsequent violation of the same nature would result in the imposition by the exchange of the appropriate penalty," he added.

The PSE on Monday slapped a P50,000 fine on San Miguel because it did not provide the date of the execution of its agreement with Government Service Insurance System (GSIS) covering the Meralco stake buyout.

The regulator said the information was vital since "it apprise the investing public of the actual date for the delivery of the down payment which can ensure that the planned acquisition of shares will materialize."

San Miguel however argued that it sufficiently informed the PSE and the public about the material details of its investment in Meralco when it disclosed on October 27, 2008 that its board gave it the green light to enter into a purchase agreement with GSIS at P90 per share.

San Miguel said this was evidenced by the fact that on November 4, the PSE had not requested for a confirmation of but only additional information regarding the transaction.

The conglomerate also earlier refused to fully disclose the option agreement it signed with SEA Refinery for the Petron stake, saying it was bound by a confidentiality clause.

Meanwhile, the Securities and Exchange Commission, in a letter to the PSE, said it would hold back any ruling on the applicability of the mandatory tender offer rules on the option agreement between San Miguel and SEA Refinery.

The SEC said a filing fee of P5,000 has to accompany PSE's "request for opinion" on the matter.

"We shall hold in abeyance any action on your request pending your compliance witht the said requirement," it said.

The PSE previously tossed to the SEC the issue of the mandatory offer in connection to San Miguel's acqusition of SEA Refinery Corp., which owns 50.1 percent of Petron.

Under the option agreement between the parties, San Miguel may proceed with the purchase in two years from Dec. 24, 2008.

An official of SEC earlier said that San Miguel is not required to make a tender offer at the moment.