Thursday, April 9, 2015

Biz Buzz: Management shakeup?


Top executives at Philippine Long Distance Telephone Co. may have bigger worries than the more-than-occasional potshots main rival Globe Telecom has been taking on its dominant status.


The organization is rife with rumors of an impending management shakeup following last year’s disappointing earnings results, which PLDT attributed to intensifying competition with special emphasis on the mobile Internet usage space.


It could be recalled that PLDT implemented a popular “free Internet” promo in late 2014 for mobile units Smart and Sun Cellular. It branded this initiative as a “success” in terms of stimulating data usage, but the subsidy for its tens of millions of users also came at a steep financial cost.


Now, back to those rumors that we’re hearing, pieced together from people claiming to have heard something and the occasional, unverified Internet blog article. It seems that a common thread among these talks is that PLDT’s big boss Manuel V. Pangilinan is eyeing key management changes and that it could happen fairly soon—in the coming weeks or months.


We’ve tried to get in touch directly with PLDT but no one was willing to go on the record about this. Well, maybe that’s because these are just rumors—some of which are quite nasty.


Take, for example, one recent post from a website called “Smart behind the Scenes,” which detailed how Charles Lim, wireless consumer division head at Smart and one of the architects behind the free Internet promo, has “stepped” down.


This was supposedly due to big losses from forgone revenues when PLDT decided to give subscribers some 30 megabytes of free Internet a day. The article even suggested that Lim was moving to the telco venture being established by rival San Miguel Corp., which is expected to launch in early 2016.


Turns out it’s not true. Our own SMC sources denied this and PLDT president Napoleon Nazareno told Biz Buzz there was “no truth” to the rumor that Lim was resigning or has been asked to resign.


Sure, that clears up one aspect of this but many questions still remain. Somehow, we think that’s not the last we’ll hear about the topic. So, as we always say in this space, Abangan! Miguel R. Camus


Ayala’s new favorite venue


ANY doubt over which hotel the Ayala group favors nowadays has been laid to rest after the conglomerate’s various listed companies held their annual stockholders’ meetings this week at the new Fairmont Hotel for the second year in a row.


Longtime stockholders of Ayala firms—Ayala Land, Globe Telecom, Bank of the Philippine Islands, Manila Water, Integrated Microelectronics or the parent firm, Ayala Corp.—are, of course, more familiar with the Hotel Intercontinental on the corner of Ayala Avenue and Edsa where the annual meetings have been held for many years, until last year.


With the opening of the new Fairmort-Raffles building in 2014, however, the country’s oldest conglomerate promptly shifted its favor to the new hotel complex for their series of annual meetings.


These meetings normally run for five days straight, culminating in the mega-meeting of the parent firm where all the unit heads join the Zobel brothers—Jaime Augusto and Fernando—to face the public and the media to answer questions about their companies (something that is rarer that one would imagine, despite their relatively high public profiles).


With Fairmont Hotel being the new favorite venue, people are wondering what will happen now to the venerable Intercon, which is one of the oldest hotels in Makati.


Well, we understand that there is a plan to demolish the existing structure and build on the site a mixed-use development in its stead.


The plan has been there for some years now, but it is unclear when it will be executed. We hear it could happen as early as next year, that is, if market conditions permit. That’s because the last thing the group wants is to get caught by a sudden economic downturn in the middle of investing a few billion pesos on a new project.


Barring adverse developments, however, we may see the old Intercon come down soon and a new structure take its place in a few years. It’s probably about time anyway. Daxim L. Lucas


Doubling down on Mandaluyong


THE CAMPOS family-owned real estate developer, Greenfield Development Corp., will invest P20 billion in a master-planned community in Mandaluyong City that it will call Greenfield District.


According to the company, Mandaluyong’s central location and proximity to major thoroughfares make it accessible to business hubs, schools, hospitals and lifestyle centers, hence its decision to build its new project there.


Of course, there’s a long relationship between the Camposes and the general vicinity, given that the family’s patriarch founded the pharmaceutical giant, Unilab, whose sprawling compound still exists in that city. Note that the company first built the iconic Edsa Central, which is now a hub of commerce and transportation, in the 1970s.


In any case, Greenfield— led by its chair, Jeffrey Campos—believes that its project’s central location makes it a prime piece of land, given its accessibility to Ortigas, Makati and Bonifacio Global City.


“We will further the development here in Greenfield District to show confidence in a city where we first ventured into real estate,” said Greenfield EVP and general manager Duane A.X. Santos.


The company said that the 12.8-hectare expanse of the new project would host a network of mixed-use commercial and retail buildings, open spaces and residential communities.


To help alleviate the traffic situation, Greenfield District allotted a portion of its space for green areas, pocket parks, roads and walkways. The entire site is envisioned to be pedestrian-friendly with the help of its interconnected, above-ground walkways. Vehicles can also navigate and avoid traffic through its secondary interconnected underground road network.


Given the company’s track record, the concept just might work. Daxim L. Lucas


Engineers needed at ERC


A FEW months before the Energy Regulatory Commission (ERC) takes on a new chair, President Aquino completed the quasi-judicial court’s lineup by appointing former Board of Investments governor Geronimo D. Sta. Ana as fourth commissioner on March 19.


Sta. Ana, an accountant by profession, was sworn in last April 7 and will have a term of five years or until July 10, 2020.


His presence is seen to boost the commission’s collective understanding of the financial side of energy projects and issues under their purview. According to his profile from ERC, Sta. Ana has extensive experience in audit work.


ERC Commissioner Alfredo J. Non is also an accountant with expertise in audit work.


The remaining two members of ERC’s commission are lawyers. Its chair, Zenaida G. Cruz-Ducut, is a lawyer.


There are those of the view that there should be more engineers in the commission.


“Why are there lawyers at all? Lawyers should be advisors to the board, not members of the board,” said one critic of the current number of lawyers at commission-level in ERC.


The regulatory body is set to name a new chair to replace Ducut, who may or may not return to public office, on July 10.


Under R.A. 9136 or the Electric Power Industry Reform Act (Epira), the ERC will be composed of a chair and four members with recognized competence in energy, law, economics, finance, commerce or engineering. Riza T. Olchondra


Passport war redux


LAWYERS for Oberthur Technologies S.A.—the company that formerly held the contract with the Department of Foreign Affairs for producing the country’s passports—yesterday hit back at government-owned printing firm APO Production Unit Inc. for the problems encountered by the latter upon taking over the role held by the former.


In particular, Oberthur’s local legal representatives pointed out that the company was the pioneer in introducing e-passports to the Philippines. And, more importantly, it was not responsible for the supposed sabotage against the system after it lost the contract as alleged by some parties.


It is also untrue that the quality of its passports were substandard, it pointed out, as evidenced by the fact that DFA kept it as a contractor for many years.


Then Oberthur’s lawyers buried the knife in APO’s side, saying: “Maintaining an e-passport system is an enormous task. Hence, [Oberthur] completely understands if APO is overwhelmed by the task that suddenly fell on its lap.” Ouch.


Having buried the knife to the hilt, Oberthur proceeded to twist the blade, adding: “It is so overwhelming for APO that their initial reaction to things that they are technically cognizant about is to claim that the system is being subjected to numerous attacks and interference, so to speak.” In other words, Oberthur (the former contractor) is saying that APO (the new contractor) is making excuses for supposedly not being able to perform its duties.


“The supposed claims of ‘sabotage’ are nothing but petty technical difficulties that APO cannot solve because of their technical inadequacy,” the firm added. Double ouch.


Will APO hit back? That remains to be seen. Meanwhile, officials of the government firm are pointing to their excellent grading marks from agencies like the Commission on Audit and the Governance Commission for GOCCs as their best defense.


This catfight isn’t over folks. Watch this space. Daxim L. Lucas


E-mail us at bizbuzz@inquirer.com.ph. Get business alerts and a preview of Biz Buzz the evening before it comes out. Text ON INQ BUSINESS to 4467 (P2.50/alert)



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