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    Cemco Holdings V National Life Insurance (Digest)

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    Alecs Samantha Laohoo
    Cemco Holdings, Inc. v. National Life Insurance of the Philippines. G.R. No. 171815, 7 August 2007. Digest/reviewer by Alecs Laohoo.

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    © All Rights Reserved
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    Cemco Holdings V National Life Insurance (Digest)

    Uploaded by

    Alecs Samantha Laohoo
    799 views1 page
    Cemco Holdings, Inc. v. National Life Insurance of the Philippines. G.R. No. 171815, 7 August 2007. Digest/reviewer by Alecs Laohoo.

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    Cemco Holdings v National Life Insurance (Digest)

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    Cemco Holdings, Inc. v. National Life Insurance of the Philippines. G.R. No. 171815, 7 August 2007. Digest/reviewer by Alecs Laohoo.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    799 views1 page

    Cemco Holdings V National Life Insurance (Digest)

    Uploaded by

    Alecs Samantha Laohoo
    Cemco Holdings, Inc. v. National Life Insurance of the Philippines. G.R. No. 171815, 7 August 2007. Digest/reviewer by Alecs Laohoo.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    Cemco Holdings v National Life Insurance 2.

    Is Cemco’s purchase of UCC shares subject to the tender offer


    (G.R. No. 171815, 7 August 2007) requirement, and does the rule on mandatory tender offer also
    apply to shares that were indirectly acquired?
    Petitioner(s): Cemco Holdings, Inc.
    Respondent(s): National Life Insurance Company of the Philippines, Inc.
    OPINION(S) OF THE COURT and RULING
    ANTECEDENT FACTS R.A. No. 8799 grants authority to SEC to regulate, investigate, or
    supervise the activities of persons to ensure compliance with the
    Union Cement Corporation (UCC) has 2 principal stockholders: UCHC
    Securities Regulation Code. The purpose thereof is to protect investors
    (60.51%) and Cemco (17.03%). Majority of UCHC’s stocks are owned by
    and to minimize fraudulent and manipulative devises.
    BCI (21.31%) and ACC (29.69%). Cemco owned 9% of UCHC stocks.
    The power conferred upon SEC to promulgate rules and regulations is a
    BCI informed PSEi that it and its subsidiary ACC had passed resolutions
    legislative recognition and the impossibility of foreseeing all the possible
    to sell to Cemco BCI’s stocks in UCHC equivalent to 21.31% and ACC’s
    contingencies that cannot be addressed in advance.
    stocks in UCHC equivalent to 29.69%.
    The mandatory tender offer is still applicable even if the acquisition is less
    Cemco’s beneficial ownership in UCC increased by 36%, amounting to
    than the 35% threshold, when the purchase would result in ownership of
    53% of all shares of UCC.
    over 51% of the total outstanding equity securities of the company.
    PSEi inquired to SEC as to whether the Tender Offer Rule is applicable to
    Cemco’s purchase of the majority shares of UCC.
    DOCTRINES, CONCEPTS and LAWS
    Respondent National Life Insurance Company (NLIC), a minority
    R.A. No. 8799 (The Securities Regulation Code)
    shareholder of UCC, sent a letter to Cemco demanding the latter to
    comply with the rule of mandatory tender offer. Cemco refused. o Section 19: Tender Offer
    o Bid by a third-party to acquire a substantial percentage of
    o NLIC filed a complaint with SEC asking to reverse the Resolution
    a company’s stock, generally at a price above market
    declaring the finality of the Cemco’s purchase
    price, for the purpose of taking over the company
    o SEC ruled in favor of NLIC, and Court of Appeals (CA) similarly
    o If shareholding exceeds the 35% threshold, the law
    affirmed this decision
    makes it mandatory for the acquiring person to offer to
    Cemco contends that R.A. No. 8799, Section 19 does not vest SEC with buy the shares of the other shareholders
    jurisdiction to adjudicate and determine rights and obligation of the parties o Gives minority shareholders the chance to exit a public
    since, under the same statute, SEC is not authorized to issue orders company by selling their shares at the same price as
    granting affirmative reliefs. those of the majority or controlling shareholders in case
    they are not comfortable with the new group of
    shareholders
    ISSUE(S)
    o Gives authority to SEC to impose administrative sanctions (i.e.
    1. Does SEC have jurisdiction to adjudicate the dispute between the imposition of fines, suspension or revocation of registration, etc.)
    parties involved, or to render judgment requiring Cemco to make
    a tender offer for the UCC shares in question?
    Reviewer by Alecs Laohoo

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