MANILA, January 26, 2006
 (MALAYA) By MAX ESTAYO - The Government Service Insurance System is selling its entire stake in Equitable PCI Bank for about P8 billion after a hostile takeover bid by rival Banco de Oro.

GSIS president and general manager Winston Garcia said the entire stake 90.07 million shares or 12.4 percent of EPCIB’s 727 million shares, will be sold at P92 per share.

GSIS is making the offer until March 6 this year.

"For transparency and to give everybody a chance, we’re selling the shares as a block," Garcia said.

The 12.4 percent is equivalent to two seats in the 15-man EPCIB board.

Garcia said the estimated P8 billion that will be raised will be used to service the fund’s obligations to its members.

"We will only accept cash offer," Garcia said.

Garcia said they’re selling the shares even without the benefit of a financial advisor, stressing they will sell to the highest bidder.

"We don’t need a financial advisor to tell us that P93 is higher than P92," Garcia said.

Garcia did not say if there’s an interested buyer at this point but taipan John Gokengwei is said to be interested in reclaiming the bank he jointly owned and sold with the Lopezes.

Garcia said GSIS is selling at the shares at P92 even if the shares were closing at P62 per share at the stock market.

"If there’s a failure, we’ll bid it again. Anybody can bid," Garcia said, adding that even Banco de Oro may also join in the bidding.

Analysts, however, said it is remote retail magnate Henry Sy will buy the shares at that price. BDO has made an offer of just over P50 per share for the EPCIB shares.

Currently, the SM Group controls 34 percent of EPCIB including the 3.8 percent held by BDO.

GSIS acquired the 12.4 percent share during the Estrada administration at P92 per share at the same time another pension fund, the Social Security System, bought 25.8 percent of the bank.

With a combined shareholdings of 38 percent, the pension funds make the government the single biggest shareholder of the third largest lender.

EPCIB has been embroiled in a number of boardroom controversies.

Both the SSS and GSIS want to drop their investments in EPCIB, which have not been profitable because of the corporate wrangling but there have been no buyers willing to get the shares at the acquisition price.

SSS and GSIS officials said selling EPCIB to hostile buyers like BDO will dilute their shareholdings, closing their option to recover their investments in EPCIB.

Garcia said offers to purchase the GSIS shares must be accompanied by a cashier’s or manager’s check equivalent to 10 percent of the total offered price and must be submitted to the GSIS not later than March 6.

Chief News Editor: Sol Jose Vanzi

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