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THE
Social Security Commission (SSC), the policymaking body
of the Social Security System (SSS), is reiterating its
preemptive right in Philex Mining Corp. saying the
company must follow procedures in disposing its shares
to the public.
In a
statement, SSC chairman Thelmo Cunanan said the
preemptive right of a shareholder, as provided by the
company’s charter, must be observed to avoid future
complications on the sale.
“The
preemptive right of a shareholder has not been denied by
the company’s charter and ratified by the shareholders
as required by law, so it must be observed,” Cunanan
said.
The
squabble started when SSS president and chief executive
Romulo Neri opposed the approval given by the majority
of the board of directors on the sale of 20 percent or
778,444,065 shares of Philex to Hong Kong-based
conglomerate First Pacific Co. Ltd.
SSS—with
Neri as signatory—wrote to Philex chairman Walter Brown
questioning the transaction. The SSS official noted that
Philex must comply with preemptive rights of all
shareholders, including the SSS.
The six
directors, including two independent members, who voted
for the deal with First Pacific stated that they firmly
and in good faith believe that it is beneficial to the
company and its shareholders for a several reasons.
Cunanan,
who heads the fund’s nine-member tripartite commission
representing labor, management and government, said
Neri’s objection was a valid exercise of his duties as a
director of the company.
“Sec.
Neri raised a valid issue of preemptive rights of
shareholders, which could derail a potentially
beneficial deal for Philex. In fact, he was acting in
the best interest of Philex and the SSS,” he said.
For its
part, Philiex said the “anagement consulted external and
internal legal counsel, as well as the corporate
secretary, and they were all of the opinion that a
pre-emptive right does not apply in this case.”
Brown,
in his response to SSS letter, said the acquisition by
the pension fund of the shares at the selling price of
P7.92 per share, when Philex was trading that day at
only P6.80, would expose the pension fund to possible
suit by its own members. |
