In a counter-statement, Ongpin said they have been assured by their legal counsel that Coyiuto’s petition "is totally out of order." We will vigorously oppose it," he added.
Last June 10, the Eighth Division of the Court of Appeals issued a temporary restraining order (TRO) on the private placement of ISMI shares by Philweb, a listed information technology company chaired by Ongpin.
The TRO was in response to an April 25 derivative suit filed by Coyiuto against the Philippine Stock Exchange (PSE) – where ironically he is an incumbent director – and the Ongpin group from enforcing the private placement transaction.
To recall, the previous PSE board and its listing committee chaired by Coyiuto last year denied the request of ISMI to exempt it from the Exchange’s Rule on Additional Listing requiring companies to first make a rights or public offering before undertaking a private placement, debt-to-equity swap, share-for-share or property-for-share conversions, and other similar transactions.
However, ISMI elevated the case to the Securities and Exchange Commission (SEC) which overturned the PSE’s ruling through two directives issued earlier this year. The present PSE board, headed by Coyiuto’s archrival Vivian Yuchengco, decided not to appeal the SEC’s order.
The CA said it acted on Coyiuto’s petition to "obviate a situation where the issues raised in the petition might be rendered moot and academic." In its order, it gave the PSE and ISMI 10 days to comment on the resolution and show cause why the preliminary injunction should not be granted.
"It is deplorable that Mr. Coyiuto, under the guise of protecting the minority shareholders of ISMI, has continued to defy not only the SEC en banc but also the decision of the entire board of the PSE to grant the ISMI exemption," Ongpin said.
He added that Coyiuto’s insistence of not granting exemption would, in fact, hurt not just the minority shareholders of ISMI but all its stockholders as well as the company would then have no alternative but to revert back to a moribound mining company.
Under the private placement deal, Philweb would subscribe to 40 percent of ISMI as payment for managing and transforming the company into the IT and multi-media business.
ISMI said since it is a losing company, it cannot afford a rights offering as no underwriter would be willing to assume the risks and the capital infusion from Philweb would be needed to resurrect its operations and bail it out from its present predicament, an argument the SEC upheld. – Conrado Diaz Jr.