The supposed buyer of some 783.85 million shares owned by farmers in San Miguel Corp. (SMC) has withrawn its offer, citing tight funding conditions due to the global financial crunch, the Philippine Coconut Producers Federation Inc. (Cocofed) told the Sandiganbayan and the Supreme Court on Monday.
Top Frontier Investment Holdings Inc. notified Cocofed of its decision not to push through with the purchase in a letter dated Jan. 27, 2009, according to a four-page Manifestation that law office Angara Abello Concepcion Regala and Cruz (ACCRA), counsel for Cocofed, filed before the courts.
Top Frontier's letter was signed by its president, Manuel del Rosario, who died two days later of multiple organ failure antecedent to cardiopolmunary arrest.
In the letter, del Rosario explained to Cocofed that adverse developments stemming from the financial crisis in the US prevented them from proceeding with the transaction.
"The global stock market has collapsed dragging with it the whole financial system which has brought the US, European nations and the rest of the world into the depths of recession. Amidst the bailouts of major foreign banks, the availability of capital continues to be really tight…making it extremely difficult, if not impossible, for us to raise the substantial funds needed to purchase the SMC shares," he said.
Cocofed noted, however, that they were optimistic they could soon present, for approval of the courts, "an alternative mode or method by which the earnings of the SMC shares can be enhanced and expeditiously utilized for the benefit of the coconut farmers."
Moreover, it said, "there are other parties who have expressed interest to acquire the SMC shares."
The Presidential Commission on Good Government (PCGG), representing the State, has been trying to forge an agreement with Cocofed and other claimants of the SMC shares to undertake the sale but has been hampered by legal challenges.
Although the Sandiganbayan First Division had already forfeited the disputed shares in favor of the government way back in May 2004, the PCGG has been unable to liquidate them because of a pending case at the Supreme Court seeking reversal of the graft court’s decision in which Cocofed was a petitioner.
The shares which were subject of Top Frontier’s offer included 446,452,536 San Miguel "A" shares and 307,395,776 "B" shares.
The shares belonged to 14 holding companies under the Cococnut Industry Investment Funds, namely, ASC Investors Inc., ARC Investors Inc., Toda Holdings Inc., Te Deum Resources Inc., Rock Steel Resources Inc., San Miguel Officers Corps Inc., Roxas Shares Inc., AP Holdings Inc., Valhalla Properties Limited Inc., Soriano Shares Inc., Randy Allied Ventures Inc., Anglo Ventures Corp., First Meridian Development Inc., and Fernandez Holdings Inc.