Premiere’s stock prices have remained boringly stable until early this year when prices soared upon news about the proposed merger broke out. Premiere hardly made movies, so there was nothing to stir things up. The merger with Next Mobile was the best thing that happened to Premiere and its shareholders.
The memorandum of understanding between the two companies was actually executed last June 27. It stated that immediately after the due diligence, the parties shall formalize the valuation and structure of the proposed transaction and shall seek the approval of their respective board of directors. Within 45 days from the end of the due diligence of Sept. 15, the parties shall then cause the ratification by their shareholders of the approval of their board.
Sources from the grapevine say that Next Mobile will soon call for a special shareholders’ meeting also to have the proposed merger approved.
Obviously, the merger will be highly beneficial for both companies, given Next Mobile’s congressional franchise to engage in the telecommunications business, and PEP’s listing privilege. Sources say Next Mobile wants to raise funds through a public listing to allow it to boost its nationwide trunk radio coverage.
Congratulations are in order for Trade and Industry Secretary Mar Roxas for presenting the Philippine positions well and having the fortitude to stand his ground and for Agriculture Secretary Cito Lorenzo who held by the position of the agricultural sector for the establishment of certain special products which a country will defend.
The collapse of the Cancun talks should be celebrated by countries like ours. Observers note that we have learned how to play the game and our ministers are not the same ones who were fooled then (the same ones who sold out the agricultural sector by agreeing to open the doors wide to cheap and highly subsidized imported items even when other countries still had their doors closed by keeping their non-tariff barriers, maintaining tariff rates that were much higher than ours, or by continuing to subsidize their farmers).
According to the US Trade Representative’s Office (but of course, we don’t have to believe this), the United States has reduced its trade-distorting support to its agricultural sectors at a faster rate than the European Union and Japan.
In 2002, US farm support was 17.6 percent of the total value of agricultural production, compared to 36.5 percent in the EU and 59 percent in Japan. In money terms, levels of agricultural support in Japan per hectare is $9,709 while that in the EU is $676 per hectare, and the US, $117.
The EU‘s average agricultural tariff is 30 percent while that of Japan is a little less than 50 percent. The US has an average of only 12 percent while the average allowed tariff on agriculture products for WTO members is greater than 60 percent. That of the Cairns Group is more than 30 percent. (So why on earth are our tariffs lower? Again, blame those negotiators.)
It is also said that the EU relies heavily on export subsidies to dispose of surplus production that drives down world prices. It spends over $2 billion a year on export subsidies, accounting for 90 percent of all WTO notified export subsidies. The US, on the other hand, spent less than $60 million in 2001.
Developing nations like the Philippines have had enough. We had to insist on the continued protection of certain special products for the sake of food security. But of course, the big agricultural exporting nations want to see the end of our agricultural sector so that we will just have to buy our food from them.
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