What’s next for Mariano Tanenglian?
Business circles are now rife with speculative talk about the cause and true nature of the feud between wealthy Chinese-Filipino businessman Lucio Tan and one of his brothers, Mariano Chua Tanenglian. And one cannot help but wonder if this feud is actually the beginning of the end of the Tan family’s mighty business empire.
There are rumors of Mariano’s alleged embezzlement of company funds for personal profit, which is somewhat difficult to believe considering what the brothers had gone through in business together all these years, and of significant business losses from trading in metals and speculative hedging on jet fuel prices.
Obviously, with Mariano handling treasury for the group, he cannot expect to be blameless for financial troubles, if any. But he has been doing finance for Lucio’s businesses in the last 50 years. And for sure, in all those years, his financial management was not always perfect. But why the relationship blow out now?
There is also talk of the 69-yeard-old Mariano going into business for himself, investing in a real estate venture without the permission of his older brother, the 74-year-old Lucio. Some people claim Lucio is particular about loyalty to the family business, and has ordered that all family members working for the group cannot work nor do business externally.
That Lucio and Mariano are not blood brothers, as some pundits point out, does not seem to be an issue. But it remains uncertain whether Lucio is also about to question the loyalty of their brothers Harry and Frank or Chang Wing Kit, and brothers-in-law of Domingo Chua Cheung Chi Ming. The worse that can happen is for the ongoing feud to divide the family further.
Not at a time when business is not doing too well. The cigarette and liquor business are now under threat both from smugglers as well as new taxes; their airline business is adversely affected by rising fuel prices; the merger of their banks is also held back by regulatory issues. There is also the issue of their profitability, with one stockholder reportedly complaining that bank stocks she had bought at P100 apiece were now worth just a little over P23 per share.
It is always sad to read about family, or brothers, fighting over business. And Philippine industry has seen enough of such fights over the years. To the credit of the Gokongwei brothers, for instance, despite the passing of Henry and Johnson Robert, eldest brother John and youngest brother James continue to work well with Henry’s and Johnson’s children.
In the case of the Lucio Tan Group, what started out as a small trading firm in the late 1950s diversified into chemicals, cigarettes and liquor, a piggery, several banks, hotels, airlines, and real estate development. And today, the group has business interests in the Philippines, China and Hong Kong, Papua New Guinea, Guam, Canada, and the United States.
Also, it is easy enough to mistakenly think that the group was founded solely by Lucio Tan. People in the know are quick to point out that the group’s business success can also be credited to three other people. Aside from Lucio, there were Benito Tan and Florencio Santos, now both deceased, and of course, Mariano.
Being a commerce graduate, as opposed to Lucio’s degree in chemical engineering and Florencio Santos’s law degree, it was only fitting that Mariano handled treasury for the group. And this was for almost 50 years, for nearly all the companies in the group, until the publicized falling out between brothers that reportedly started in February.
With only Lucio and Mariano still alive, and with no clear succession rules, perhaps the 74-year-old family patriarch is beginning to feel insecure with his younger brother’s influence in the company. Also, one can speculate the possibility of infighting among Lucio’s aides, especially after their boss’ recent surgery. What happens to them when he goes is anybody’s guess.
Also raised by speculators is Mariano’s supposed loyalty to Lucio Tan’s first family. Coffee shop wags claim that because of their late Tan mother’s insistence on faithfulness, Mariano acknowledges the legitimacy of Lucio’s first wife, Carmen, and thus reportedly recognizes Lucio Tan, Jr. as his father’s rightful heir.
But unfortunately for Lucio Khao Tan, Jr. or Bong, despite his bachelor’s degree in Civil Engineering and his Executive Masters in Business and Administration from Northwestern University and the Hong Kong University of Science and Technology, and the supposed support of his Uncle Mariano, he does not seem to be in his father’s favour.
As for Mariano’s fate, the word is, he has been told to move overseas with the rest of his immediate family. In February, he was already barred from entering the premises of the Allied Bank Building on Ayala Avenue, where he holds office. This prompted him to sue the bank’s security chief, which reportedly even earned him the irritation of his brother.
Talk about 50 years of contribution and dedication to the family businesses suddenly being rendered worthless. Since then, Mariano’s nominations to the various Tan company boards have been withdrawn, including that for Allied Bank and Philippine National Bank, Tanduay Distillers, Philippine Airlines, Eton Properties, and MacroAsia.
History is replete with stories of kings, emperors, or even wealthy and powerful businessmen whose empires were eventually brought to ruins by mismanagement or even family squabbles, or worse, by wedges driven between family members by ambitious and scheming but undeserving underlings. One can only wish Lucio Tan the best of luck in keeping his family and his businesses from falling apart.
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