Business owners should be grateful to the public
Because listed companies have issued common shares to public investors, they are considered public as far as the Securities and Exchange Commission (SEC) and the Philippine Stock Exchange (PSE) are concerned.
This is why it is useless for a regulatory authority such as the SEC to require listed companies not at all public to submit so-called “certificates of attendance for the annual corporate governance program.”
What for are these certificates when profitability is the main reason for the existence of listed companies and other stock corporations?
Just imagine the time wasted by executives in attending seminars when they could have focused their energy more in making as much net income as possible to boost their retained earnings.
For instance, here is a disclosure posted on PSE website by Euro-Med Laboratories Philippines Inc., which reported having 4.112 billion outstanding common shares.
In said filing, Euro-Med said: “Pursuant to SEC Memorandum Circular No. 20, Series of 2013, enclosed herewith is the Certificate of Attendance for the Annual Corporate Governance Program conducted by Philippine Corporate Enhancement & Governance Inc., held yesterday, 17 October 2018 at Dusit Thani Hotel, Ayala Center, Makati City attended by the following officers: “Janice R. Ong, corporate secretary & investment relations officer; Isleen Y. Sy, vice president; Ma. Bernadette M. Doctor, assistant treasurer; and Sandra N. Pineda, chief accountant.”
Annual meeting
In a PSE posting, Prime Media Holdings Inc. (PRIM) said it will meet its stockholders during the company’s annual meeting at 9:30 in the morning of Dec. 3, 2018. Venue is The Metropolitan
Club Inc., which it said is located at Estrella cor. Amapola Sts., Guadalupe Viejo, Makati City.
No. 7 of the 10-point agenda is the election of seven directors – two of them independent – for the board chaired by Manolito A. Manalo, who is also the company’s president.
In the same posting, Prime Media reminded its stockholders that “all proxies must be submitted to the Corporate Secretary on or before Nov. 22, 2018, 5 p.m. at the following address: Prime Media Holdings Inc. c/o Marcventures 4th Floor., Citibank Center, Makati City.
In its disclosure, Prime Media said RYM Business Management Corp. is the company’s new majority stockholder as owner of 311.785 million common shares which it bought from Neo Oracle Holdings Inc. and Metro Tagaytay Land Co. Inc.
In the same filing, RYM Business said it paid P74.545 million for Neo Oracle’s 93.685 million PRIM common shares and P57.052 million for Metro Tagaytay’s 218.099 million PRIM common shares.
The payments translate to an average price of P0.422 per PRIM common share. However, RYM said in the same filing that in a special block sale on May 31, 2016, it paid Neo Oracle P0.7957 per PRIM common share and Metro Tagaytay P0.2616 per PRIM common share.
RYM is now the owner of 610.734 million PRIM common shares, which are equivalent to 87.38 percent.
Acquisitions
Alfonso G. Reyno 3rd is president and chief operating officer of Manila Jockey Club Inc. (MJCI) On Oct. 21, 2018, he made a series of acquisitions which he said increased his holdings to 70.733 million MJCI common shares, or 7.10 percent.
His acquisitions totalling 57,942 MJCI common shares were as follows: 9,999 MJCI common shares at P5.06 each; 4,799 MJCI common shares at P5.05 each; 9,949 MJCI common shares at P5.15 each; and 33,095 MJCI common shares at P5.20 each.
In his filing, Reyno said he made the additional acquisitions through Siera Prime Properties Corp., which made him an MJCI indirect stockholder.
On Oct. 17, 2018, MJCI opened trading at its high of P5.38, dropped to a session’s low of P5.30, the stock’s closing price.
Acquisitions 2
Tita P. Villanueva is senior vice president and chief finance officer of Crown Asia Chemicals Corp. (CAC). On Oct. 17, 2018, she bought 10,000 CAC common shares at P1.62 per share and 30,000 CAC common shares at P1.64 per share.
With these acquisitions, her indirect holdings increased to 73.201 million CAC common shares, or 11.60 percent, which, she said, are held by Walter H. Villanueva, her husband.
In the same filing, she said Walter did all these acquisitions.
In addition to their conjugal CAC holdings, she also directly holds 47.28 million CAC common shares, or 7.50 percent.
Due Diligencer’s take
Insiders have a big advantage over public investors who rely only on disclosures for either their acquisition or sale of listed stocks. They are executives of listed stocks with some of them even members of the board usually controlled by their family.
As public investors, they should not hate these families for controlling their own business or businesses. Instead, they should admire these families for sharing with them the ownership of their business.
However, it is only proper for these families to also share with their public stockholders membership in the board. Instead of appointing independent directors, these business owners led by the patriarch should allow the election as director of anyone among their public stockholders. After all, public investors are responsible for making their businesses listed even if they are not necessarily public.
By the way, does the sale of common shares by majority stockholders make companies public? Listed companies do not allow their public stockholders to elect any one of them to the board of listed companies.
Finally, when would business owners realize the importance to them of the public as stockholders of their businesses? Just asking.
Email: esdeperez@gmail.com
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