SEC defers decision on San Miguel tender offer issue


Posted at Feb 12 2009 05:57 PM | Updated as of Feb 13 2009 06:09 AM

Five thousand pesos.

That's what has kept the Securities and Exchange Commission (SEC) from issuing a decision on whether San Miguel Corp is required to make a tender offer to the minority shareholders of Petron where the diversified conglomerate now has an indirect majority stake.

On Thursday, the SEC said in a letter to the Philippine Stock Exchange (PSE) first needs to settle a P5,000 filing fee that should go with its request.

Last month, the PSE tossed to the SEC the tender offer issue after minority shareholders of Petron complained that the option agreement between San Miguel and a unit of Ashmore, another major Petron stockholder, may, in substance, have given San Miguel control of the giant oil company.

After the San Miguel and Ashmore's local unit signed the option agreement, San Miguel representatives clinched key posts in Petron's board and management.

“Please be advised that said request takes the form of a request for opinion, which, pursuant to Appendix A of the 2006 Rules of Procedure of the Commission, should be accompanied by the payment of a filing fee. In view thereof, we shall hold in abeyance any action on your request pending your compliance with said requirement,” said SEC director for corporation finance department Justina Callangan.

We tried to reach PSE president Francis Lim, for their plans to pursue the issue with the SEC but our calls and texts went unanswered.

Tender or not?

In previous media reports, an anonymous SEC official has been quoted saying that San Miguel was not required to do a mandatory tender offer to the other shareholders of oil refiner Petron Corp., at least at this time.

The official said San Miguel is not obliged because it has yet to formally come in and consummate the purchase of shares in Petron.

“When the transaction is completely done then that's the only time we will require them to do a tender offer,” explained the official.

The tender offer rule, as provided by the Securities Regulation Code (SRC), is mandatory for a company that acquired at least 35 percent of a publicly traded firm.

The SEC official explained the election of Ramon S. Ang, Eduardo M. Cojuangco and Estelito Mendoza as directors of the Petron board should not be taken as a takeover in Petron as they were nominated to the board by the Ashmore Group, currently the controlling stakeholder of the oil giant.