PCGG exec says P25 B lost due to gov't failure to sell SMC shares

MANILA, Philippines – A Presidential Commission on Good Government (PCGG) official said the failure of the government to sell the sequestered 27-percent stake in food and beverage conglomerate San Miguel Corp. (SMC) last year resulted in a loss of some P25 billion for coconut farmers who would have benefited from its disposal.

PCGG commissioner Ricardo Abcede said the drop in the price of SMC shares in the stock market this year had greatly reduced their value as compared to last year when government planned to sell.

“The shares could have earned a higher price if it was sold last year. But we failed to do so. So now, if we will sell, it will be at the prevailing price. Hopefully, it will still go up,” Abcede said.

The closing price of SMC-A shares yesterday at the stock market was at P46 while SMC-B shares closed at P46.50.

Last year the price of SMC shares hit a high of P80 per share.

Abcede said the distrust and bickering among the different coconut farmers’ groups on the mode of distribution of the proceeds prevented the PCGG from selling the 27-percent SMC stake.

“In effect, the coconut farmers lost around P25 billion,” Abcede told reporters in a briefing the other day.

He said the PCGG, with the support of the Department of Finance (DOF), had planned to sell the SMC stake last year in view of their analysis that the share price of the conglomerate was then at a high.

“(The) projection of the DOF was correct after all,” Abcede said.

With the Sandiganbayan yet to issue a ruling forfeiting the 27-percent SMC stake, Abcede said they had planned last year to auction off the shares and deposit the proceeds in an escrow account.

He said then PCGG chairman Camilo Sabio had devised a plan to form a foundation made up of small coconut farmers that would decide on the mode of distribution of the funds from the escrow account.

“The problem at that time was there was always distrust,” Abcede said.