PCC voids Udenna acquisition of KGLI

MANILA, Philippines — The Philippine Competition Commission (PCC) has voided the transaction involving the acquisition of Dennis Uy-led Udenna Corp. of KGL Investment Cooperatief U.A. (KGLI Coop) and penalized both companies for failure to comply with the compulsory notification of mergers and acquisitions under the Philippine Competition Act (PCA).

In an en banc decision released yesterday, the PCC fined Udenna and KGLI Coop the amount of P19.6 million, equivalent to one percent of the value of their merger transaction which “both companies failed to run by the government agency as required by law.”

“After careful consideration of the facts and evidence on record, the commission hereby rules that respondents consummated the transaction in violation of the notification requirements under Section 17 of the PCA…the transaction is hereby declared void,” the PCC said.

Under Section 17 of the PCA, parties who fail to notify the PCC of a transaction that meets the threshold are slapped with a fine ranging from one percent to five percent of the transaction value and their business deal voided.

“The law is clear: an agreement consummated in violation of the competition law’s compulsory notification requirement shall be fined and is considered void,” the PCC said.