BIZ BUZZ: P14.85-B BDO credit rests on Piki
Looks like it’s not just the Razon group that wants to make sure that embattled Federico “Piki” Lopez stays as chief executive officer of First Gen Corp.
According to a BDO loan document seen by the Inquirer, a P14.85-billion letter of credit in favor of Prime Hydropower Energy Inc. will be “terminated” in case of a “change of management control.”
“Change of management control” was expressly defined in the document as when the CEO of First Gen “ceases to be Federico Lopez (FRL) or his designee”.
Also considered a material change that will lead to the termination of the credit line is if the members of the executive committee of First Gen “cease to be designees of FRL.”
These were identified as Federico Lopez, Francis Giles Puno, Jonathan Russell, Emmanuel Singson, Victor Emmanuel Santos Jr., Jerome Cainglet and Vincent Martin Villegas.
And the list goes on.
Also written down as triggers include: if Lopez ceases to be a director of First Philippine Holdings Corp., his designees no longer constitute at least a majority of the members of the board of directors of First Gen, and if Lopez and his family “will cease to own directly or indirectly at least 29.17% of Lopez,Inc.”
To recall, Lopez had been ousted as president of Lopez Inc. by his cousins who together hold the majority of the shares of the – the private holding company of the Lopez family.
Piki has won an injunction and remains as president although his cousins led by Eugenio “Gabby” Lopez III are bent on having him removed, citing a pattern of non-disclosure of key, multi-billion-peso agreements, including the partnership with tycoon Enrique Razon for energy projects.
BDO, however, seems to not want the family turmoil at the top to seep into the project level, if only to protect their depositors’ money.
What BDO put down, however, is not exactly a unique condition, and is indeed standard provision of large transactions.
For if there is something that financial institutions do not want, it is change that heightens the risk of not getting their money back.
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