Pangilinan says NTT talks ‘very positive’

Philippine Long Distance Telephone Co. (PLDT) president and chief executive officer Manuel V. Pangilinan described yesterday his talks with top officials of Nippon Telegraph and Telephone Co. (NTT) of Tokyo, Japan as fruitful but would not disclose what was discussed.

Pangilinan arrived yesterday afternoon and was quoted as saying that the outcome of the meeting was "very positive."

"I am greatly encouraged by the positive statements of support made to us by senior officials of NTT. And I look forward to a much stronger relationship between PLDT and NTT," Pangilinan said.

He and PLDT chairman Antonio O. Cojuangco met with key NTT officials in Tokyo on Thursday to discuss a broad range of issues, including plans for the company.

In a statement, PLDT said NTT gave its assurance that it was very satisfied and pleased with the performance of PLDT’s board of directors in managing the affairs and business of PLDT.

A group led by Pangilinan and Cojuangco is reportedly interested in buying out First Pacific’s stake in NTT, but in order to do this the group must be able to convince NTT to exercise its right of first refusal and then assign this right to the PLDT team that is contemplating the counter offer.

Highly placed sources told The STAR that Pangilinan and Cojuangco, together with their lawyers presented the various options available to them and PLDT. "NTT was non-committal but sounded interested," sources privy to the talks said.

NTT to bare decision on Tuesday

NTT is expected to announce by Tuesday its decision regarding the exercise of its right of first refusal over the 24.4 percent controlling interest of FPC in PLDT.

This developed after top officials, led by Pangilinan and Cojuangco met with key NTT officials in Tokyo, Japan on Thursday to discuss abroad range of issues.

FPC is selling its 24.4 percent controlling stake in PLDT as well as its 50.4 percent interest in Bonifacio Land Corp. (BLC) to a joint venture company that will be owned two-thirds by the Gokongwei group and one-third by the Hong Kong conglomerate. The Gokongwei group is paying a whopping $116.6 million for around 16.4 percent stake in PLDT equivalent to two seats in the 13-man board.

NTT’s non-committal stance may be due to the fact that it was still scheduled to meet Anthoni Salim yesterday afternoon. Salim, whose family controls FPC engineered the deal with Gokongwei group patriarch John Gokongwei Jr.

First Pacific also requested for an audience to get support from the Japanese telco giant, which owns 15 percent of PLDT and which has a shareholder’s agreement with FPC that provides the right of first refusal in case of a sale or transfer, in its bid to sell part of its Philippine interest to the Gokongwei group. NTT’s top brass said it would talk only to the young Salim, son of Seodono Salim who established FPC and who tapped the management skills of Pangilinan to help FPC become the Asian powerhouse it was before the regional crisis of 1997.

But with the retirement of the Salim group patriarch and the Asian crisis that forced FPC to sell many of its assets, Anthoni became more involved in the business and has started to question many of Pangilinan’s investment decisions, which to the younger Salim’s belief, has not been contributing dividends to the group.

Pangilinan has opposed Salim’s decision to divest FPC’s stake in the Philippines but was outvoted 9-0 (Pangilinan was asked to abstain from voting) in an FPC board meeting that approved the MOA with the Gokongwei group signed last June 4.

PLDT board opposes sale

The PLDT board has issued a resolution opposing the sale to the Gokongweis and preventing the latter from undertaking a due diligence review of PLDT’s financial and technical operations. The conduct of a due diligence investigation is a necessary prerequisite set by the Gokongwei group for the completion of the transaction.

Not to be outdone, FPC, through general counsel Ron Brown, said it was removing its proxy nominations assigned to Pangilinan that could have resulted in a shake-up of the current PLDT board composition, but the move could not be implemented due to technicalities, including the 60-day notice.

And during the controversial June 11 annual stockholder’s meeting and board election, the 13-man board that voted to oppose the sale to the Gokongweis was reelected.

Salim, meanwhile, is facing another legal battle, this time in Indonesia. He is being suspected of trying to buy back their Indonesian assets (more than 100 companies) which were transferred to the Indonesian government to repay the huge debt it owed.

Holdiko Perkasa, an Indonesian Bank Restructuring Agency Unit, was tasked with selling companies taken over the Salim group. But Holdika is now being questioned by Indonesia’s antimonopoly commission KPPU for irregularities in the sale of PT Indomobil Sukses International, a former Salim Group auto maker.

KPPU is a government agency created in 1999 to discourage the monopolistic practices that plagued Indonesia under former President Suharto. It claims that the three would-be buyers of Indonesia’s second largest automaker were able to collude in their bidding so that the company was sold for less than what it was worth.

The sale sparked allegations in the Indonesian media that Salim was behind the purchase. Former bank owners such as Salim are banned under Indonesian law from buying back their assets until they have repaid their debt to the state in full.