“ I don’t need A,B,C,D or E or even FG to be successful”, said Bobby Ongpin following Sen. Osmena’s accusation that he had higher backing for the Philex deal.
In Nov. 2009, Delta Ventures Resources, an Ongpin company allegedly capitalized at P625,000, in days secured loans totaling P660 million from DBP to acquire 50 million Philex shares at 12.75/share. A month later Ongpin sold these shares to Manny Pangilinan’s company at P21.00 for a gain of P412.5 million.
The loan was fully paid with interest.
Rey David was then the President of DBP appointed by GMA.
Ongpin and David are friends who had transacted other deals. David sits as director of Atok Big Wedge, ISM Communications and Phil. Bank of Communications; all chaired by Ongpin.
DBP extended a mega loan to Ongpin’s group to buy Meralco shares which were subsequently sold to Pangilinan’s Piltel. GSIS, SSS and Landbank were major shareholders in Meralco.
David advised PNOC (what we now know to be absurd) when it sold its 40% stake in Petron to SEA Refinery, a unit of Ashmore represented by Ongpin. SEA subsequently sold its interest to San Miguel.
Ongpin was reportedly involved in the MRT deal. DBP and Landbank extended a $180 MM (P 7.9 billion) loan to Global Air Services, a shell foreign company, to acquire MRT shares from the original shareholders. GAS then sold the shares to DBP/LB apparently by offsetting the loan against an inflated purchase price. Details are shrouded because of a non-disclosure agreement (why the secrecy?) but the talk is it stank. It is worth a Senate enquiry.
This is the business model: One, identify companies where Government institutions have an important stake. Two, “persuade” these institutions to sell their position at a certain price. Three, locate a party that will buy the shares above this price. Four, acquire the shares for your account first using easy financing from Government banks. Five, flip the stake to the ultimate buyer at a gain. Six, buy loose shares in the market ahead of the transaction to further juice the profit.
A variant is to find an ailing company like MRT and stuff it to the Government on some economic pretext.
Step 2 is the heart of the matter. In the Philex case:
– Why did DBP not offer its Philex shares to Pangilinan? The latter had officially announced five months earlier his desire to acquire upto 40% of the company. David, described by Ongpin as “one of the smartest bankers in the country”, had the legal responsibility particularly for an asset this size to get the best price through a transparent and competitive bidding process; yet he chose to deal exclusively with his friend -and now business associate and defender- Ongpin. The haste of the DBP loan further suggests the deal was wired all the way.
– Ongpin admits the loan was expedited because the market price of Philex was already at P12.75 thereby threatening the deal. Rather than fast track the loan should this not have prompted DBP to slow the process and rethink the price?
– Was there a conspiracy to defraud and by whom? Following the money trail might provide some answers.
Ongpin admits to being a friend of Mike Arroyo yet has “met him not more than 5 times”. This must be the definition of “friendship of convenience”.
Ongpin professes to love the Philippines and to have attracted billions in foreign investments. The nation might arguably be better off without either his love or his foreign money.
Cases have been filed against Ongpin, David and other DBP officials in the Philex matter. A word of caution to the Government: This Administration (and the public) is rightfully incensed at what is a blatant shakedown of our treasury. However, it should not let its heart get ahead of its mind: Don’t get mad, get even.
The cases should be driven by what will legally stick, not what will play to the gallery. Public anger generates the political will but it is the law that, hopefully, brings redemption.
The cases against the DBP officers are weightier than those against Ongpin (Hence his invitation: “Come after me, not Rey David”): Unless proven to be a co-conspirator, it is no crime to be granted P660 MM loans in short shrift nor to be sold shares at below their true value. One simply says thank you and leave a little something on the way out.
The onus for protecting our national treasury is with our Government officials: The Administration should nail the erring public servants preferably for a non-bailable offense and get them to squeal. Let’s then see what happens.
If a conspiracy to rape can be affirmed and by whom, it would force illegal profits to be disgorged.
It would also disclose whether friends indeed were involved and their position in the alphabet.