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Thursday, October 09, 2008

SSS to Philex: Observe Pre-emptive Rights

Social Security Commission, the policy-making body of the country’s largest pension fund, said Philiex Mining Corp must follow procedures in disposing its shares to the public.

Social Security Commission Chairman Thelmo Cunanan said the pre-emptive right of a shareholder, as provided by the company’s charter, must be observed to avoid future complications on the sale.

“The pre-emptive right of a shareholder has not been denied by the company’s charter and ratified by the shareholders as required by law, so it must be observed,” Cunanan said.
Philex Mining Corp, the country’s oldest and largest mining company, announced early this week a bloc sale of 20 percent of the company shares to the First Pacific of Hong Kong.

SSS President Romulo Neri indicated that Philex must comply with pre-emptive rights of all shareholders, including the SSS.

Cunanan, who heads the fund’s nine member tripartite commission representing labor, management and government, said Neri’s good faith objection was a valid exercise of his duties as a director of the company.

“Neri raised a valid issue of pre-emptive rights of shareholders , which could derail a potentially beneficial deal for Philex. In fact, he was acting in the best interest of Philex and the SSS,” he said.

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