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BIZ BUZZ: Flip-flopping BIR

/ 04:25 AM May 18, 2022

The Bureau of Internal Revenue’s (BIR) media advisory sent on Tuesday afternoon surprised journalists covering the taxman for many years—it was the first time, for as long as we can remember, that the BIR identified which taxpayer it was supposed to shut down.

Deputy Commissioner Arnel Guballa, Regional Director Eduardo Pagulayan Jr. and other officials of the agency’s Revenue Region 8-B covering south National Capital Region, will issue a closure order against Megaworld Corp., the BIR announcement read.

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Before issuing the closure order, the BIR was to host reporters for breakfast at Denny’s in Megaworld’s own upscale Uptown development in BGC. Sources said the closure order was supposed to be issued today, on the very day that BIR called the press conference, hence the advisory being issued a day before.

At first confused if it was really the real estate giant which the BIR would close down due to unpaid taxes, Biz Buzz quickly texted Guballa to clarify if it’s Megaworld or perhaps just a Pogo nearby, similar to their “Oplan Kandado” operations in the past.

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Guballa’s short reply to Biz Buzz was: “Secret.”

In response, Megaworld also issued a statement saying that “we have already reached out to the concerned BIR regional office, and the matter has been clarified and resolved.”

After a reporter tweeted the advisory, the listed firm’s stocks fell 9 percent, although it recovered in minutes. Buyers came in hot; MEG closed up 2.94 percent from Monday by the end of Tuesday’s session.

Nearly three hours after the first media advisory, the BIR sent an updated one, signed by Pagulayan, which read: “The [May 18] activity is being held in abeyance until further notice.”

“Representatives from Megaworld manifested their full cooperation with all the requirements of the BIR,” the country’s biggest tax-collection agency said.

Who blinked first? Was it an intentional “advisory” sent to the media (which perhaps tax officials hoped would immediately reach the company) to also quickly collect whatever Megaworld owed the BIR?

Whatever it was, company sources tell us that the issue was about an audit of sales revenues—an audit that hadn’t been conducted yet. No formal notice was also served on Megaworld, insiders said. There’s also a lingering question of whether the company is, in fact, under the jurisdiction of the BIR office in question, we hear.

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Incidentally, word on the street is that BIR’s Pagulayan is retiring next month.

—Ben O. de Vera, Miguel R. Camus and Daxim L. Lucas

‘Legacy brand’ takeover

The pandemic has forced many businesses to streamline operations in the last two years. But not businessman Lester Yu, whose kiosk chain operator Fruitas Holdings Inc. saw an opportunity to expand its food and beverage offerings as households prioritize spending for essential items.

During this challenging period, Fruitas has taken the merger and acquisition (M&A) route three times so far.

In February 2020, before the hard lockdowns, Fruitas acquired Soy Kingdom Inc., owner of The Tofu Store, which has been rebranded to Soy&Bean, to cater to those looking for healthy food options.

To ramp up its delivery channel, CocoDelivery Inc. was acquired in March 2020.

In June 2021, it acquired Balai Pandesal, which offers traditional pan de sal alongside cake, bread spreads, taho and ice cream. This is the business that Yu has lined up for a stock market debut.

It earlier aborted plans to diversify into the health-care segment (through the acquisition of Surehealth Multi-Specialty and Diagnostic Clinic Corp.), as the group heeded market feedback that it must stick to core businesses.

According to the reliable grapevine, Fruitas is now preparing for its fourth pandemic M&A. It is a food business that will offer dine-in and allied services to institutional customers. From what we hear, this is an Asian dining concept and a “legacy brand” at that.

As Winston Churchill said after World War II: “Never let a good crisis go to waste.”

—Doris Dumlao-Abadilla

Homecoming

ING has appointed veteran banker Jun Palanca—who is returning to the Philippines (and to ING) after spending over 20 years in Singapore and Hong Kong—to lead its wholesale banking business effective May 16.

A banking veteran with close to 30 years of experience, Palanca had worked at Citibank Philippines from 1993 to 1995 before joining ING’s project finance team in 1996.

He was with ING for 10 years and was director of loan syndications for Asia before moving to Merrill Lynch in 2006. In 2010, he joined Sumitomo Mitsui Banking Corp. and, in 2016, became its regional head of loans distribution for Asia and head of structured credit distribution.

“We are excited to welcome Mr. Palanca back to ING and to the Philippines. With such a broad experience across corporate and investment banking in Asia-Pacific, we have no doubt that he will be able to lead the team in offering product and financing solutions that meet the growing needs of our clients,” said ING country head and managing director Hans Sicat.

Palanca will report to Sicat and Anju Abrol, ING’s head of wholesale banking for the Asia-Pacific. “With a solid history in the Philippines that goes back to 1990, ING has a strong position in the country’s M&A, corporate advisory and capital markets. As head of WB Philippines, Mr. Palanca will be responsible for continuing our business momentum by executing the pillars of our Asia-Pacific strategy to leverage ING’s global network, deepen our client relationships and strengthen our position as the ‘go-to bank’ for sustainable finance,” said Abrol.

—Doris Dumlao-Abadilla INQ
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