IN THE PDI August 12 issue, the Pagcor spokesman was quoted as being cold to the offer of San Miguel vice chair Ramon Ang to buy the government gambling firm.
Pagcor spokesman's comment #1: "The $10-B proposal I think is too low. With an annual gross revenue of P30-B, Pagcor can easily earn P690-B when its franchise ends in 2033, a difference of P240-B from Ang's proposal."
My comment: Pagcor's spokesman oversimplifies his analysis. Hasn't he heard of investment returns? If Pagcor accepts the $10B (P450B) being offered now and invests it at a return of 5 percent per annum (a very conservative assumption) compounded annually, the amount will have accumulated to P1.3 trillion in 2033 (23 years). It's almost twice the P690-B being projected by Pagcor that it can earn up to 2033 if it operates the gambling firm on its own. So there.
Take note, too, that the Pagcor spokesman quotes a P30-billion annual gross income. If you deduct operating expenses and such, the net income by 2033 will definitely be much smaller than P690-B.
Pagcor comment #2: "Ang said he could raise Pagcor's annual revenue to at least P35B. If he could do it, why can't we?"
My comment: Sorry to disappoint Pagcor, but they can't, or they won't, for the simple reason that it's been amply proven in different countries of the world that the efficiency of government agencies pale in comparison to that of private enterprises. Especially in running for-profit ventures.
Add to that the fact that, over the decades, San Miguel's Ang has more than sufficiently proven his extraordinary business acumen and ability -- almost every business he touches turns into gold. I don't know if the present management of Pagcor can claim even just half as much money-making ability.
I believe that the biggest reason why the Pagcor top management doesn't want the firm sold is that if the sale pushes thru they are the first ones to be retired by Ang. But the self-preservation of a few people should not get in the way of bringing progress to the country and its millions of poor people who are bound to benefit from the $10B sale.
If I were the president, I'd jump at the opportunity to sell Pagcor, while there are still hot A-1 buyers. If it's true that the past administration has left a largely empty bag, and I have no reason to doubt it, why, this is the chance to fill it back for implementing much-needed projects and programs for the people.
Let's not go into analysis paralysis. A semi-optimum decision made at the right time is much better than an optimum decision made too late. Let's sell Pagcor now.
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Management tip of the week: To succeed, you must continually learn-from your supervisors, your peers and even your subordinates. No matter how good you are, or so you think, other people always have other good ideas that you don't know yet. But you won't ever hear what they have to say if you're the one always talking. You'll never learn anything new from what you're saying-you already know them, you see. Remember the saying, "you can't listen with your mouth open."
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