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Selling PAGCOR to get rid of the deficit is probably a good deal for the country

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PAGCOR in my hometown of Ciudad de Parañaque.

I think this Noynoy guy is doing a good job so far.

After delivering his inaugural speech in Tagalog, a language that is now generally understood throughout the archipelago, he immediately issued Executive Order No. 1 to investigate the previous administration’s corruption whose legacy of deceit, poverty, and greed was carried over to the present one. Noynoy then brazenly fired GMA’s midnight apointees as well as an inefficient PAGASA chief. He also made true to his promise about solving the decades-old impasse in his family’s controversial Hacienda Luisita (although many farmers still disagree with him).

Now here is an opportunity for P-Noy to finally get rid of that irritating budget deficit that has been harassing our economy for countless years:

$10B offered for Pagcor
Tycoon Ramón Ang bids for gambling firm

With President Benigno Aquino III facing cash problems, San Miguel Corp. vice chair Ramón S. Ang is proposing the privatization of Philippine Amusement and Gaming Corp. (Pagcor) to raise as much as $10 billion and transform the country into a tiger economy.

Should Mr. Aquino listen to his suggestion, Ang said in a recent interview with the Philippine Daily Inquirer that he himself planned to make a bid to acquire Pagcor with Malaysia’s “big boys.”

Ang was referring to Robert Kuok, the richest man in Southeast Asia with a net worth of $10 billion; Ananda Krishnan, second wealthiest in the region with a net worth of $7.4 billion; and Francis Yeoh, who runs YTL, one of Malaysia’s biggest conglomerates.

“They’re all my friends and they are interested in Pagcor,” said Ang, whose first investment outside the Philippines was in Malaysia in partnership with former Prime Minister Mahathir Mohamad in 1998.

“San Miguel is not interested in going into gambling and I am going in this on my own. I do not intend to hold on this for long,” he said.

In his first State of the Nation Address, Mr. Aquino revealed his strategy of public-private partnerships and selling or leasing government assets to raise money for the government grappling with a deficit likely to hit P350 billion this year.

Last month, Mr. Aquino announced that he was open to privatizing Pagcor after assessing its assets and existing contracts.

Spectacular deal

“The sale of Pagcor fits in well with the President’s agenda. We are not asking him for anything but be true to his campaign promise of ensuring a level playing field for all businessmen,” Ang said.

“Why wait for six years to have $10 billion when he can have $10 billion in just six months? His government does not have to sell anything else and he will make the country a tiger economy immediately. Isn’t this a spectacular deal?”

Ang said that Pagcor would be worth at least P450 billion based on its 2009 gross income of P29.78 billion and the minimum 15 times premium value investors were willing to pay for a monopoly gambling business like Pagcor.

“It could go as high as 17 times premium compared to an average gambling firm which fetches an average premium of 10 times,” he said.

Indeed, if Noynoy decides to sell PAGCOR, then that will place our country on a much higher economic level in Southeast Asia. Never mind if this is all paquitang-guilas (an act of showing-off) on the part of Noynoy for his first 100 days in office. Never mind if Ramón Ang is his uncle Eduardo “Danding” Cojuangco’s most trusted man. As long as selling PAGCOR will benefit the economy, then P-Noy should strike while the iron is hot.

You may read the rest of the story here.

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