SM Investments shakes up management, prepares 3rd generation
MANILA, Philippines – Harley Sy, 57, handed on Wednesday, April 26, the chief executive role of SM Investments Corporation (SMIC) to Frederic DyBuncio, leaving the group's senior management team without a member of the Sy family and preparing the 3rd generation to lead in the "near future."
DyBuncio, also 57, replaced Sy as the president of SMIC, while the latter remains as executive director of the SM group.
Harley's father, Henry Sy, 92, who opened the first Shoemart store in 1958, has become chairman emeritus of SMIC. Jose Sio, who served as SMIC's chief financial officer for almost 3 decades, was appointed to succeed Sy as the chairman of the board.
"It is an indication that the family would like to professionalize the management of the SM group in preparation for the future," Sio said in a conference following SMIC’s annual stockholders’ meeting in Pasay City on Wednesday, April 26.
Sio said SMIC is also preparing the 3rd generation of the Sy family to take leadership positions in the near future.
"We are preparing the 3rd generation. They are more or less immersed with the SM group. We are preparing them to take leadership positions in the near future," Sio told reporters and analysts.
Harley said there are 7 of the 3rd generation of the Sys "spread throughout the core businesses." (READ: SM Prime, Ayala to defy China's slowdown)
"Some are in the supermarkets, some in the property," Harley said without divulging further details.
Harley's siblings, Henry Jr and Teresita, remain vice chairpersons of SMIC. The last major organizational shakeup was in October 2016, when Hans Sy, Harley's brother, stepped down as president of SM Prime Holdings Incorporated. Hans was replaced by Jeffrey Lim.
For the 10th consecutive year, Henry Sy topped Forbes' list of richest Filipinos, with a 2017 net worth of $12.7 billion.
Infra to support core businesses
The Sy family's core businesses are SM Prime (real estate), BDO Unibank Incorporated (banking), and SM Retail Incorporated.
SMIC's portfolio also include Belle Corporation, Atlas Mining, the Net Buildings, CityMalls, MyTown, and most recently 2GO Group Incorporated.
Moving forward, Sio said SMIC will look into "infrastructure and energy" projects that will support its core businesses.
"Infrastructure and energy are the industries that can complement our 3 core businesses," Sio said, adding that the group is interested in bringing in "not just equity, but also financing" in these sectors.
SM gaming unit Belle has partnered with Solar group's All-Asia Resources and Reclamation Corporation for an unsolicited proposal to develop a $50-billion airport and economic zone at Sangley Point in Cavite.
Just this year, SM group has also partnered with Ayala Corporation for another proposed P25-billion elevated tollway linking SM Mall of Asia in Pasay City to Sta Mesa, Manila
"SM was very focus on our core businesses, now that the economy continues to grow, we think infrastructure is going to support our other businesses. This is why we are looking into those possibilities as well," DyBuncio said.
In 2009, SM Prime signed a memorandum of agreement with Light Rail Transit (LRT) Authority, agreeing that the Metro Rail Transit (MRT)-LRT common station should be beside SM North EDSA, after the mall developer paid the government P200 million for the naming rights to the proposed station.
"We don't look at it as infrastructure on its own. Our sort of preference or interest will be if it is an infrastructure that is going to help our other developments. For example, this project with Ayala, it is really to bring traffic to SM Mall of Asia area. That was really an incentive for us to be part of that project," said DyBuncio, who worked for over 20 years with JP Morgan Chase and its predecessor companies before joining SM.
This 2017, SM Prime is scheduled to open 5 new malls in the Philippines, all of which are outside Metro Manila. These are: SM CDO Downtown Premier in Cagayan de Oro, SM Cherry Antipolo in Rizal, SM Center Tuguegarao Downtown in Cagayan, SM City Puerto Princesa in Palawan, and SM Center Lemery in Batangas.
By the end of 2017, SM Prime will have 65 malls in the Philippines and 7 malls in China.
SM Prime contributed 39% to the company's income last year, while the banking sector accounted for 37% and SM Retail at 24%. – with reports from Sofia Tomacruz/Rappler.com