Biz Buzz: Win-win solution, redux
Don’t be surprised if you will see officials of the Department of Finance and the Bureau of Internal Revenue smiling from ear to ear nowadays.
That’s because the government has finally received the second tranche of the payment from Japan Tobacco Inc. for its acquisition of Mighty Corp., bringing the deal even closer to fruition.
JTI, of course, made a P45-billion offer to buy Bulacan-based Mighty—lock, stock and barrel—from its owners, giving the founding Wongchuking family an unprecedented cash windfall.
The deal called for a total of P25 billion to be paid to the government to settle the cigarette maker’s liabilities, with the remaining P20 billion providing a handsome payday to the brothers who grew the firm from a mere 3-percent market share to an eye-popping 25 percent (giving its larger competitors a run for their money, in the process).
In any case, Biz Buzz learned that yesterday’s payment came in at P12 billion, bringing the total funds so far brought to the government’s hands to P15 billion, taking into account the P3 billion JTI had put in escrow as a deposit when at the deal’s inception.
And don’t be surprised if you’ll see tax officials smiling broadly again in a couple of months. Our sources tell us that the final P10-billion payment will be made in November, giving the Duterte administration the singular bragging right of having sealed the single biggest tax collection case in the country’s history.
And Mighty’s original owners? They win, too, thanks to the 11-digit bank accounts they will suddenly have at the end of the deal.
The question now is what will JTI do with Mighty once it takes over operations? Will it continue the firm’s strategy of selling affordable tobacco products (potentially killing the Japanese firm’s own brands here)? Or execute a “buy-in-and-kill-it” strategy? Or leverage off Mighty’s strengths in provincial areas to take on industry giant Philip Morris-Fortune Tobacco Corp.? The competition landscape going forward looks interesting. —DAXIM L. LUCAS
New Chinabank prexy
Another major bank in the country is undergoing management changes this year.
China Bank Corp., led by the sons of tycoon Henry Sy, has named William Whang—currently executive vice president and chief operating office—as new president and director effective Nov. 1. Whang will take the place of 66-year-old Ricardo Chua, who’s retiring after 42 years of service to the bank.
In recognition of his excellent service to the bank and his valuable insights and counsel, China Bank has retained Chua as adviser to the board. Note that Chua is retiring as president and chief executive officer but the bank has not announced any new CEO appointment—yet.
The incoming president, Whang, is himself just a year shy of turning into a senior citizen but in this organization, age doesn’t seem to matter. Recall that Peter Dee retired as president at 72.
Whang, who joined Chinabank in 2011, has over 30 years of experience in corporate banking, branch banking and consumer retail in various institutions such as Metrobank, Republic National Bank of New York, International Exchange Bank, Union Bank, Security Bank and Sterling Bank of Asia. He graduated from the DLSU with a degree in Commerce, major in Business Management.
With Whang moving up the ladder, Romeo Uyan Jr., currently head of financial capital markets and investments and head of China Bank Investments, is likewise promoted to be the new COO.
China Bank, the first privately owned local commercial bank in the country, has been operating for nearly a century (now 97 years old). It has a rich legacy, having been established by the tycoons of yesteryears initially to serve the needs of the migrant Chinese businessmen which could not borrow from other banks at that time.
Meanwhile, the bank is also celebrating a major milestone this September: its 90th year as a publicly listed company (it debuted on the old Manila Stock Exchange in 1927). It’s just waiting for the “ghost month” to end to hold its ceremonial ringing of the bell at the Philippine Stock Exchange. This will happen on Sept. 20. —DORIS DUMLAO-ABADILLA
Surprise latecomer
Salcedo Auctions is getting ready for what is probably the biggest and most expensive event in its history—something that will also see the entire lobby of the Peninsula Manila Hotel in Makati City transformed into a display and auction floor on the weekend of Sept. 23-24.
Dubbed “The Well Appointed Life,” the industry pioneer will almost certainly exceed last year’s record value of P300 million sold during the previous auction.
By how much will it beat this record? The final number might be substantial given that rare and important paintings by masters are still arriving at the gallery’s doorstep being consigned for the awaited event two weekends from now.
The latest—and one of the most exciting latecomers—is a “surprise lot” that came to the auction house from an American collection.
It was given to the owner as a gift by a friend who had been to the Philippines in the 1970s. The current owner has never been to the country, but found out about Salcedo Auctions by word of mouth all the way from the US.
We’re talking about an untitled Mauro “Malang” Santos depicting a barrio scene painted all the way back in 1974. It’s oil on wood and measures 32 inches by 48 inches.
And thus reads the official description: “In this magnificent oil masterwork, Malang creates a remarkable tableau of his most beloved subjects; a multicolored scene of his jeepney, carabao, and cockfight interspersed among churches and nipa huts embraced in his abundant foliage, and populated with his trademark women: friends, farmers and vendors, a mother and child, and a full carroza scene.
All this united under a beaming sun and done in his dynamic shapes and textures, prominently set against a dramatic red background. Wonderfully brilliant and instantly eye-catching, this prismatic piece easily places itself among the most exceptional in the artist’s body of work—a complete encapsulation of the joy of Malang.”
The estimated starting auction price stands between P3.5 million and P4.5 million.
Will it go higher? Bet on it.
“With his recent passing and talk of him being the next National Artist, let’s see what will happen on Sept. 23,” said Salcedo Auctions’ big boss Ramon “Richie” Lerma. So yes, abangan. —DAXIM L. LUCAS
