SC upholds conversion of sequestered San Miguel shares into preferred

abs-cbnNEWS.com 

MANILA, Philippines - The Supreme Court has affirmed its earlier resolution allowing the conversion of over 750 million sequestered shares in San Miguel Corp. under the name of the Coconut Industry Investment Fund (CIIF) holding companies into preferred shares.


In a 16-page decision authored by Associate Justice Presbitero Velasco, the SC dismissed the motions for reconsideration filed by former senators Jovito Salonga and Wigerto Tañada, former congressman Oscar Santos, Akbayan Partylist Rep. Ana Theresa Hontiveros and Bukidnon Rep. Teofisto Guingona III seeking the reversal of the court's ruling issued last September 17, 2009.


The court agreed with the government that the conversion of the shares, representing 24% of San Miguel, "is advantageous to the public interest or will result in clear and material benefit to the eventually declared stock owners, be they the coconut farmers or the government itself."


The SC said that the motions filed by the petitioners were "replications" of their earlier oppoition to the Philippine Coconut Producers Federation Inc.'s (Cocofed) motion seeking the conversion.


In May last year, San Miguel gave its shareholders the option to exchange some 1.1 billion common shares, representing 35% of the company's voting stock, into non-voting preferred shares.


The 1.1 billion common shares included the contested 750 million shares—broken down into 446,452,536 San Miguel “A” shares and 307,395,776 “B” shares—that some 18 million coconut farmers have been trying to claim. The shares are under the care of the Presidential Commission on Good Government (PCGG), the agency tasked to oversee sequestered assets from late dictator Ferdinand Marcos while ownership of these is being contested in various courts. 


The SC ruled: "It was proved that the PCGG had exercised proper diligence in reviewing the pros and cons of the conversion. The efforts PCGG have taken with respect to the desired stock conversion argue against the notion of grave abuse of discretion."

Under the Constitution, the high court noted, it is the executive branch that has control over all matters related to the disposition of government property, including sequestered assets under the administration of the PCGG. Read more.. .