Jun. 24--The government, through the Office of the Solicitor General (OSG), on Tuesday sought the approval of the Supreme Court to sell its 24-percent stake in beverage and food giant San Miguel Corp. (SMC).

The government has made the move to prevent further losses brought about by the continued value depreciation of its shareholding due to the global financial crunch.

The government shares, which include 446,452,536 San Miguel "A" shares and 307,395,776 "B" shares, represent about 24 percent of the company. It is registered to the Coconut Industry Investment Fund (CIIF) and controlled by the government.

"It is undisputed that there has been a substantial depreciation in the stock market prices of said shares and one way by which the value of said shares may be preserved is their immediate sale at a premium price and the proceeds of which shall be deposited in an escrow account," OSG said.

Solicitor General and concurrent Acting Justice Secretary Agnes Devanadera said the government will use the proceeds of the sale for the interest of the coconut farmers and coconut industry.

In a six-page comment to the manifestation submitted by the Philippine Coconut Producers Federation Inc. (Cocofed), Devanadera said that even as Top Frontier, which proposed to buy 783.85 million shares in San Miguel for P56.54 billion, or an average of P75 a share, has withdrawn its offer to purchase, the government is obliged to pursue the sale to other interested parties.

"Amidst the bailouts of major foreign banks, the availability of capital continues to be really tight . . . making it extremely difficult, if not impossible, for us to raise the substantial funds needed to purchase the SMC shares," Top Frontier said in its letter to Cocofed dated Jan. 27, 2009.

Records showed that the subject SMC shares belonged to 14 holding companies under the CIIF, namely: ASC Investors Inc., ARC Investors Inc., Toda Holdings Inc., Te Deum Resources Inc., Rock Steel Resources Inc., San Miguel Officers Corps Inc., Roxas Shares Inc., AP Holdings Inc., Valhalla Properties Limited Inc., Soriano Shares Inc., Randy Allied Ventures Inc., Anglo Ventures Corp., First Meridian Development Inc., and Fernandez Holdings Inc.

Proceeds of the sale of said shares is to be transmitted to the Development Bank of the Philippines or to Land Bank of the Philippines under the account of the CIIF.