THE 14 Coconut Industry Investment Fund (CIIF) holding companies have issued their respective resolutions to effect the conversion of the 24-percent sequestered common shares of San Miguel Corp. (SMC) under their names into preferred shares in compliance with the recent ruling of the Supreme Court (SC).

In its manifestation, the Presidential Commission on Good Government (PCGG) submitted to the Court the secretary’s certificates of the 14 CIIF holding companies pertaining to their corporate resolutions allowing the conversion of the shares.

The PCGG submitted the resolutions to the Court in conformity with the Court’s resolution of September 17, 2009, granting the government’s bid to convert into series 1 preferred shares the subject sequestered common shares.

The Court, in the same ruling, directed the PCGG to cause the CIIF companies, including their respective directors, officers, employees, agents, to execute documents needed to carry out the conversion of the common shares into preferred shares.

Among the 14 CIIF holding companies that issued the certification offering their common shares were Anglo Ventures Corp., with 21,865,254 common shares; AP Holdings Inc., 34,669,405;  ARC Investors Inc., 105,689,360; ASC Investors Inc., 167,483,095; Fernandez Holdings Inc., 18,341,390; First Meridian Development Inc., 21, 865, 254; Rock Steel Resources Inc., 58,237,403; Roxas Shares Inc., 52,815,194; Randy Allied Ventures Inc., 24,115,227; San Miguel Officers Corps Inc., 53, 863,035; Soriano Shares Inc., 30,123,850; Te Deum Resources Inc., 58,487,823; Toda Holdings Inc., 74,880,174; and Valhalla Properties Limited Inc., 31,411,848.

The CIIF holding companies have also designated the United Coconut Planters Bank Inc. as their broker “for the purpose of facilitating and implementing the exchange offer.”

The corporations also authorized any of their officers—Camilo Sabio (chairman), Jesus Arranza (president and chief executive officer), Anthony Felipe (chief finance officer) and Narciso Nario Jr. (corporate secretary) to implement the resolutions including, but not limited to, endorsing the stock certificates covering the SMC shares and to sign any application for relating to the exchange offer; to receive certificates evidencing the series 1 preferred shares to be issued in exchange for the SMC shares; and to sign, issue and/or deliver requests, instructions, directives, receipts and other documents that may be required by UCPB Securities Inc.  in opening the corporation’s account or to avail of/implement the exchange order.

The resolutions were issued during the special meeting of the board of directors of the said corporations held on September 22.

The resolutions were issued even as the SC has yet to finally resolve the pending motions for reconsideration filed by concerned parties seeking to block the conversion of the SMC sequestered shares.

In its September 17 ruling, the Court said the conversion of the sequestered common shares into preferred shares “is advantageous to the public interest or will result in clear and material benefit to the eventually declared stock owners, be they the coconut farmers or the government itself.”

The conversion, the SC added, is necessary to preserve the value of the 753,848,312 sequestered CIIF SMC common shares in light of the worldwide economic crisis that started last year and adversely affected the country’s  banks and financial institutions, resulting in billions of loses.

The PCGG also recently filed a motion before the SC seeking the conversion of its 27,571,409 common shares in SMC being held in trust for the Comprehensive Agrarian Reform Program (CARP) into Series “1” preferred shares.

The PCGG claimed the subject PCGG ITF-CARP shares including the qualifying shares issued to PCGG nominee-directors “are also affected by the same circumstances and conditions as the CIIF SMC common shares, therefore, would also share the same benefits and advantages when converted from common shares into SMC Series 1 preferred shares.”

Opposers of the conversion led by former Senator Jovito Salonga have insisted that the conversion of the shares is patently disadvantageous to the government and the coconut farmers.

“However which way anyone tries to sugarcoat this conversion offer, it is less than honest to deny that this is a compromise agreement designed precisely to give Cocofed [Coconut Producers Federation, et al., and [Eduardo “Danding”] Cojuangco Jr., the opportunity to recover the sequestered shares [and to cash in on their value] and to provide the administration of Gloria Macapagal-Arroyo cash in form of dividends from the preferred shares that she can use in the dying months of her regime,” Salonga said.