Biz Buzz: Manila Bulletin rally
The demise of the head of a listed company is usually followed by uncertainty over the firm’s future direction which, in turn, leads of investors selling of the company’s stock.
But not in the case of Manila Bulletin Publishing Corp., apparently.
Since the company announced the death of its board chair Emilio T. Yap last Monday, shares of the listed firm have zoomed to heights not seen since a brief—and illiquid—spike in early 2013.
From only P0.485 a share a few days before Yap’s demise, MB’s price shot up to P0.93 apiece at the Philippine Stock Exchange on Thursday. That’s a whopping increase of 91 percent in just four days.
And mind you, the stock’s rally has been backed up by (relatively) large trading volumes. For a stock which can have trades of as little as P2,170 a day, value turnover zoomed up to P13.5 million as of Thursday.
Of course, the Bulletin has been known for many years for its middle-of-the-road treatment of the news (the point of having so-called “calendar” banner headlines like “18M students return to school”), but that has been changing in recent years.
We suppose more changes are slated for the venerable paper, now that it is in fresh hands. Incidentally, Yap’s companies announced that the tycoon passed away at the precise and exact time of 12:00 p.m.—high noon—last Monday.
We’re told that having a time of death when the sun is at its highest has favorable feng shui implications.—Daxim L. Lucas
Kapitan’s sugar friends
Kapitan Lucio Tan’s LT GROUP Inc. recently doubled its interest in leading local sugar firm Victorias Milling Corp. with the help of two of the latter’s creditor banks—China Banking Corp. and, not surprisingly, Philippine National Bank.
China Bank sold 19.39 million shares (0.8 percent of VMC) at P4 a share while affiliate PNB sold a bigger block of 161.98 million, or 6.8 percent, to its parent conglomerate at P4.54 a share.
LTG’s consolidation of shares in VMC is widely believed to be a defensive move, given that VMC—a key supplier of sugar to Kapitan’s beverage units—is in the radar of other interested parties, particularly the group of businessman Manuel V. Pangilinan.
It was earlier reported that the Metrobank group’s 7-percent stake in VMC has been committed to MVP’s group.—Doris C. Dumlao
New BAP board
Veteran banker Lorenzo Tan, president and chief executive officer of Rizal Commercial Banking Corp., is now on his second term as president of the influential Bankers Association of the Philippines. Likewise getting renewed vote of confidence from banking peers was BAP first vice president Antonio Moncupa, president and CEO of EastWest Bank.
Joining Tan and Moncupa on the BAP board are: Enrico Cruz, managing director and chief country officer of Deutsche Bank AG (also BAP second vice president); Gil Buenaventura, president and CEO of Development Bank of the Philippines (BAP secretary); and Roberto Panlilio, managing director and senior country officer of JP Morgan Chase Bank N.A.–Manila Branch (BAP treasurer). Cesar Virtusio remains as executive director of BAP.
Completing the 2014 BAP board membership are: Abraham Co, president of Asia United Bank; Cezar Consing, president & CEO of Bank of the Philippine Islands; Fabian Dee, president of Metropolitan Bank & Trust Co.; Reynold Gerongay, president and CEO of Robinsons Bank; Mahendra Gursahani, CEO of Standard Chartered Bank; Jaime Laya, chair and president of Philippine Trust Co.; Omar Byron Mier, president and CEO of Philippine National Bank; Justo A. Ortiz, chair and CEO of Union Bank of the Philippines; Masato Tsunoda, general manager of Mizuho Corporate Bank Ltd.–Manila Branch; and Alberto Villarosa, president and CEO, Security Bank Corp. An all boys club, that is.—Doris C. Dumlao
Trouble in paradise
The Philippine Economic Zone Authority (Peza) is famously preferred by investors seeking incentives on capital-intensive projects, and producers of bioethanol are no exception. Bioethanol, a light alcohol substitute for gasoline, apparently has export potential and this is what biofuel investors are counting on.
Trouble is, producers said, they have been having some difficulty lately when knocking on Peza’s door. It seems the government is concerned there may be a “food-versus-fuel” issue in bioethanol production since the fuel is made of fermented sugar from starchy food such as sugarcane, corn cassava and nipa.
It has come to the point that the Sugar Regulatory Administration (SRA)—which coordinates with bioethanol producers on the production side—recently wrote to Trade Secretary Gregory Domingo (who chairs the Peza board). In its position paper, SRA assured that bioethanol production could even help promote food security since the presence of another market helps boost farmer incomes and tempers the seasonal volatility of food prices.
There is another side to the argument, however. Industry observers have expressed concern whether exports are really possible when the Philippines itself is not self-sufficient in bioethanol. In mid-2013, regulators said they were considering whether to fully implement the country’s E10 program, which mandates availability of gasoline with 10-percent bioethanol blend nationwide.
On the flipside, many bioethanol-exporting countries, such as Thailand with its E20 mandate, increased domestic consumption. This is tightening supplies available for export, and presents opportunity for new exporters.
What to do, what to do?—Riza T. Olchondra
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