Ongpin et al. probed in P9B Meralco deal
Businessman Roberto Ongpin (left) and former Finance Secretary Margarito Teves. Is investigation spurred by their public support for rivals of the Aquino administration’s presidential candidate, Mar Roxas?
The Office of the Ombudsman is investigating businessman Roberto Ongpin, his associates and current and former executives of a state pension fund and a state-run bank for the alleged P9-billion “sweetheart deal” given to Ongpin’s firm in 2009 involving the sale of government shares in Manila Electric Co. (Meralco).
The country’s largest distributor of electricity, Meralco services Metro Manila and nearby cities and provinces, which account for about half of the country’s gross domestic product.
The Office of the Ombudsman spokesperson, Janina Hidalgo, said on Wednesday the antigraft agency was investigating officials of the Social Security System (SSS), Land Bank of the Philippines and the Ongpin-led Global 5000 Investment in the “anomalous” deal.
At a news conference, Hidalgo said the officials and businessmen involved in the deal could face multiple graft charges over the block sale of Meralco shares to Global 5000 in 2008 and 2009.
The sale of minority Meralco shares held by SSS and Landbank took place while control over the major power distributor, then owned by the Lopez family, was being contested by San Miguel Corp. led by Ramon Ang and the business conglomerate steered by Manuel V. Pangilinan.
Pangilinan’s business group eventually edged out San Miguel for control of Meralco.
Other Global execs
Ongpin, a former Marcos trade minister, is under investigation along with Global 5000 executives Iñigo Zobel (chair), Joselito Campos Jr. (vice president), Consuelo Eden Lagao and Rhodel Gandingco.
Ongpin, then president and CEO of Global 5000, is a known supporter of Sen. Francis Escudero, running mate of Sen. Grace Poe in the May 2016 presidential election.
Margarito Teves, former finance secretary of the Arroyo administration, is also included in the investigation for his involvement in the sale of Landbank’s Meralco shares.
Teves is now treasurer of the United Nationalist Alliance (UNA), the political party of Vice President Jejomar Binay, the first to announce that he will run for President in 2016.
Mar Roxas’ rivals
Asked whether the investigation of Ongpin and Teves was spurred by their public support for rivals of the Aquino administration’s presidential candidate, Mar Roxas, Hidalgo denied this was a factor.
“We don’t investigate cases based on politics but based on evidence,” she said.
Landbank president and CEO Gilda Pico will also be investigated with other bank executives—Roberto Vergara, Carel Halog, Marianito Roque, Patricia Rualo-Bello, Eduardo Nolasco, Albert Balingit, Ombre Hamsirani, George Regalado and Cyril del Callar.
Pico, Vergara and Halog are also facing administrative charges for grave misconduct and conduct prejudicial to the best interest of the service, according to the Office of the Ombudsman.
Cunanan, Neri
Former SSS Chair Thelmo Cunanan, who passed away in 2011, was still included among those under investigation.
Office of the Ombudsman insiders said that under their procedures, a complaint could not be dismissed until a death certificate was presented.
Other former SSS officials under investigation are former Vice Chair Romulo Neri, Marianita Mendoza, Donald Dee, Sergio Ortiz-Luis Jr., Fe Tibayan Palileo, Victorino Balais and Sonny Matula.
The Office of the Ombudsman said that in January 2009, SSS executives led by Cunanan approved the block sale of its Meralco shares to Global 5000 for P5.669 billion or at P90 per share, for which Global made a down payment of P1.133 billion.
Unsound practice
The Commission on Audit later concluded that the “block sale was not in accordance with sound business practice as it has the effect of giving a P4.535-billion loan to Global 5000,” which had an initial paid-up capital of only P62.5 million.
Aside from financial capacity, state auditors questioned Global 5000’s lack of track record saying the company was established only one year before the sale.
Hidalgo said documents showed that SSS executives had waived voting rights in Meralco to Global 5000 despite its lack of full payment and actual transfer of ownership of the shares.
Landbank officials also approved the block sale to Global 5000 of its Meralco shares for P4.193 billion, also at P90 per share.
Unwarranted benefits
Hidalgo said the Ombudsman’s Field Investigation Office filed the complaint alleging that Landbank had given “unwarranted benefits, advantage or preference to Global, a firm with doubtful financial capacity and no track record to undertake the sale.”
She said Landbank executives had entered into the stock purchase agreement with Global 5000 without any negotiations and the deal was undertaken in 10 days.
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