Lopez majority withdraws bid to remove 'Piki' as CEO

Insider Spotlight

• Lopez majority withdraws Feb. 27 resolution ousting Federico “Piki” Lopez
• Group says move opens path for family discussions and possible compromise
• Majority warns it is ready to escalate efforts if no fair resolution emerges
• Dispute centers on P125-billion First Gen deals and alleged “poison pills”
  
  
  

The 71 percent majority bloc of Lopez Inc. has withdrawn its Feb. 27 resolution removing Federico “Piki” Lopez as president and chief executive officer, reopening the door for talks among members of one of the Philippines’ most prominent business families.

In a statement issued on Wednesday, the Lopez majority said the move was intended to create “a window for discussions among the family members” as the dispute continues at the Court of Appeals, where the case involving the lifting of an injunction remains pending.

“The withdrawal presents an opportunity for the whole family to step back, re-consider their adversarial positions, and look for options that are least injurious to the family, the Lopez group, and the investing public,” the statement said.

Federico “Piki” Lopez

President and chief executive officer, Lopez Inc.

Why it matters

The leadership conflict has spilled into public view and raised concerns among investors over governance issues within the Lopez group, which has interests in power, infrastructure, and media.

“Harm has been done to everybody. Reputational damage is there. Our family has been in a fishbowl with everybody looking in. Agreements have been signed with undeserved financial penalties especially for the investing public,” the majority bloc said in the statement.

The group added that it is open to a ceasefire if there is “a reasonable expectation of a fair compromise and access to information.” However, it warned that it is “more than ready to ramp up its efforts to protect its legal and pecuniary interests” should negotiations fail.

The backdrop

The Lopez majority earlier voted 5-2 to remove Piki from his posts, citing provisions in the company’s by-laws allowing the removal of officers “with or without cause.”

The bloc said it lost trust and confidence in Piki after he allegedly entered into P125-billion transactions through First Gen Corp. without authorization from the majority shareholders.

According to the group, it also uncovered “self-serving poison pills” embedded in the agreements that could expose the Lopez group and First Gen shareholders to penalties of up to P24 billion. 

The deals allegedly also contained cross-default loan provisions that could be triggered if Piki were removed from his position. —Vanessa Hidalgo | Ed: Corrie S. Narisma