Amadeusz Juskowiak

San miguel board appointment may mean changes

Disagreement over management of San Miguel Corp SMC may follow the Philippine governments appointment of a wellknown banker to the SMC board investment analysts said

They told Reuters the presence of United Coconut Planters Bank UCPB president Ramon Sy to the board of SMC may mean changes in SMC management which for decades was controlled by the family of its president Andres Soriano

Sy was appointed by a government commission that controls 51 pct of San Miguels stock after another nominee resigned

The Presidential Commission on Good Government PCGG holds six seats on the 15member SMC board which represent 3313 mln sequestered shares

The stocks were seized on suspicion that they were owned by Eduardo Cojuangco then chairman of UCPB and San Miguel He was a close associate of deposed president Ferdinand Marcos and he left the country after Marcoss fall

Before the seizure Soriano led a 33 billion peso bid for the shares paying UCPB a 500 mln peso deposit

The bid valued the shares at about 100 pesos They traded at 93 pesos today down from 9550 at Fridays close

Finance Secretary Jaime Ongpin told reporters on Saturday that Sy would definitely sit on the SMC board despite the objections of some directors associated with Soriano

I dont think there is a conflict of interest as such he said

I was potentially concerned with seeing a situation where you have a contentious atmosphere on the board But Sy has assured the government that he does not intend to behave in a contentious manner Ongpin added

The Soriano group cited conflict of interest in opposing Sys directorship Its lawyer said in a letter to the PCGG that a pending suit seeking forfeiture of SMCs 500 mln peso deposit and major undisclosed damages against the brewery represented a clear conflict

UCPB however sought board representation before Sys appointment petitioning the PCGG so that the interests of the owners of the 33 mln shares would be adequately protected

Investment analysts polled by Reuters said the UCPB had a right to a slot on the SMC board as trustee for coconut farmers who claim ownership of the disputed shares

The analysts said Sy backed by the government would probably suggest replacements for PCGG nominees expected to resign soon in keeping with a new law prohibiting government officials from working for private companies SMCs annual election is scheduled for May

A UCPB spokesman declined to comment saying it was up to the PCGG to decide whom to appoint

One analyst said objections were understandable from the family that founded the company 97 years ago

It is a natural instinct of selfpreservation for Soriano he said

SMC posted a net income of 4488 mln pesos in 1985 on net sales of 1099 billion pesos against 4223 mln in 1984 on sales of 1036 billion

REUTER