PSE Sanctions First Gen Over Disclosure Violations Amid Lopez Dispute

The Philippine Stock Exchange (PSE) has slapped formal sanctions on Lopez-led power producer First Gen Corp. (FGEN) for multiple violations of its Consolidated Listing and Disclosure Rules.

In a regulatory notice released on Friday, the local bourse revealed that First Gen breached seven separate sections under Article VII of the exchange's disclosure guidelines, specifically Sections 1, 2, 4.1, 4.2, 4.3, 4.4(u)(ii), and 16.

Hidden Clauses Trigger Backlash

The regulatory crackdown follows escalating controversy surrounding First Gen's multibillion-peso transactions with tycoon Enrique Razon Jr.’s Prime Infrastructure Capital.

The infractions stem from the company's delayed disclosure of critical "poison pill" clauses embedded within their joint venture agreements. These hidden change-of-management-control stipulations could allegedly expose First Gen to financial liabilities and losses reaching up to ₱23.5 billion.

Lopez Family Friction

The PSE’s intervention amplifies an ongoing corporate dispute within the Lopez family.

A majority shareholder bloc previously petitioned both the Securities and Exchange Commission (SEC) and the PSE to launch an investigation. The group claimed that the First Gen board deliberately withheld vital transactional details from the investing public, undermining shareholder transparency.

Broad Bourse Crackdown

First Gen was not the only corporate giant caught in the bourse's crosshairs. In the same enforcement notice, the PSE disclosed that real estate developer DoubleDragon Corp. was also sanctioned for separate disclosure rule violations. While the PSE has confirmed the imposition of sanctions, it has not yet made the exact financial penalties or specific remedial measures public.