Biz Buzz: Off to BGC, finally
After a nine-year wait, the Philippine Stock Exchange now sees the proverbial “light at the end of the tunnel” for the construction of its future headquarters and unified trading floor in Bonifacio Global City. The PSE and Ayala Land Inc., with much prodding from PSE chairman Jose “Titoy” Pardo, are now nearing a compromise on the long-stalled BGC property donation that was committed to the exchange even before the Ayalas’ takeover of BGC (originally a project of the Metro Pacific group).
Based on the emerging blueprint, the PSE has agreed to swap the parcel of land it was originally entitled to under a deed of donation in exchange for several floors of office space in a new office tower to be developed by ALI at a new location. (This arrangement sounds much like the existing set-up of the PSE offices inside ALI’s Tower One along Ayala Ave.)
While the PSE’s original lot is nearer the residential areas, the new office building will be closer to the BGC’s central business district, specifically where the future Shangri-La Hotel will be. With the nearing deal, the PSE is no longer considering to undertake the property development itself or even inviting alternative developers (which would have been a big slap on ALI’s face).
Pardo hopes that ALI will break ground on the new BGC office building by the first quarter of 2012. Once the PSE moves to its much-awaited headquarters, the bourse can then unlock values of its existing office space in Tower One. Its office space in Tektite tower in Ortigas, meanwhile, is still on the block.—Doris C. Dumlao
The “Carrot” approach
In lieu of the “stick” approach, PSE president Hans Sicat sees more companies being motivated by the “carrot” approach as far as adopting global best practices on corporate governance is concerned. Enter the “Bell Awards,” an annual screening of the best among the PSE’s roster, while the launch of the so-called “Maharlika” board (which embraces a similar objective albeit with more stringent requirements) has been indefinitely deferred.
“We’re trying to move the market little by little,” Sicat said in a press briefing, noting this is a process requiring “continuing building blocks.” The PSE seems to be rethinking the “Maharlika” board concept, with PSE chairman Pardo himself saying other Asian big markets like Hong Kong did not have such a separate board.
“Bell Awards,” which will start in 2012, will honor top five awardees among the country’s 252 publicly listed companies on the basis of their compliance with the PSE’s corporate governance guidelines for listed companies. It will also recognize the top six trading participants, three each from the large and small brokerage houses categories.
The awards committee is chaired by PSE director Edgardo Lacson. Don’t ask who the judges will be as the PSE would like to keep them confidential (no lobbying, please!), assuring, however, that all would be people of utmost integrity.—Doris C. Dumlao
Avante in PBB
Business magnate Alfredo Yao’s thrift banking arm, Philippine Business Bank, is expected to scale up as a more significant banking unit with treasury veteran Roland Avante recently having been brought on board as the new CEO.
Avante says his goal for the bank will be to “bring it to the next level” and make it a more active player in the small and medium enterprise lending. And then he says PBB will expand into consumer lending in order to contribute more to the local economy.
“He’s very nationalistic,” Avante says of his new boss, who also owns local beverage giant Zest-O Corp. and budget carrier Zest Airways.
PBB is seen ending this year with 65 branches and is also using a recent leeway from the central bank to open 15 new branches in the so-called restricted areas in Metro Manila. Asset base is at P26 billion. Is PBB upgrading to commercial banking? That’s certainly within the long-term horizon, Avante says.—Doris C. Dumlao
Eton’s first baby
Construction work on Eton Residences Greenbelt—the first high-rise project of Lucio Tan-owned Eton Properties Philippines—is set to be completed on Jan. 31, 2012, when the contractor turns over the finished structure to the property developer.
This is only a month behind the company’s original schedule of a Dec. 31, 2011, turnover, and not a bad pace at all, considering the work stoppage that was imposed after that unfortunate construction accident early this year.
According to our source, major construction on the 39-storey building along Legazpi Street across Greenbelt Mall in Makati City will actually be completed by year’s end, but the newbie high-rise builder found out that it takes about a month for the contractor to clean up the site after their work.
Tenants of the new building, which was sold out a few weeks after the project was launched in 2007, can expect their units to be formally turned over to them by Feb. 15, 2012.
Not bad for a first project.—Daxim L. Lucas
Smoke and mirrors
As usual, former Development Bank of the Philippines president Reynaldo David bore the brunt of Tuesday’s Senate hearing on the allegedly anomalous loans of the government financial institution to businessman Roberto Ongpin.
From insider trading, the accusation against him has evolved further into market manipulation after Sen. Serge Osmeña III read aloud minutes of the bank’s board meeting where David supposedly urged bank officials to “support” the price of Philex Mining Corp. shares so as to be able to sell it at a higher price.
David reasoned that he could not have been manipulating the price of the stock since he was not acting in concert with other parties, as is the usual practice in price manipulation schemes.
(Word around the market at the time of the transaction in 2009, of course, is that the eventual buyer of Philex was also selling in spurts … to depress its price, and thus, buy a block of shares at cheaper levels.)
Meanwhile, our sources tell us that the Senate probe will eventually tackle DBP’s role in the ownership battle for Meralco a few years ago when it resumes early next year.
The same sources say that the party running this anti-Ongpin campaign may, in fact, be targeting a specific corporate nemesis, in the guise of a “find FG’s hidden wealth” campaign. Abangan.—Daxim L. Lucas
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