Something Fishy in the Sale by GSIS of Meralco Shares to San Miguel
Business, Current Events, Politics
It must have been gratifying for the Lopezes to see GSIS head honcho Winston Garcia retreat with his tail between his legs.
Garcia, after all the sound and fury generated by the GSIS bid to take over Meralco, which led to all sorts of mischief and even dragged the judiciary down, sheepishly explained to the press that the government pension fund decided to sell out after all. The GSIS has entered into an agreement with San Miguel Coproration for the sale of the former’s 27% stake in Meralco for around P30 billion. SMC agreed to pay P90 per share for Meralco, more than double the utility company’s closing price of P44.50 at the start of the week.
Which is very odd indeed.
In a bear market, with stock prices tanking, why would SMC pay more than a 100% premium for a stake in Meralco ? Granted that it’s a block sale, but still, San Miguel could have gotten a better deal, and helped the stock market index rise, by buying over the counter. It would have given the market, and the economy as a whole, a boost at a time when it most needs it.
Many are skeptical, and see a political and financial motive behind the sudden sellout by the GSIS. Read the rest of this entry »
