The majority bloc of Lopez, Inc., led by Eugenio Lopez III, has called for an audit of the privately-held family holding firm’s books, escalating tensions over recent high-value transactions involving key energy assets.
The group, which controls 71 percent of the company, is seeking explanations from Federico “Piki” Lopez over decisions that resulted in the dilution of control in First Gen Corp. via a P50 billion sale to Prime Infrastructure of tycoon Enrique Razon Jr. and a subsequent investment in the hydropower assets under Prime Infra. for P75 billion.
At the center of the dispute is the sale of majority control in First Gen’s gas-fueled power plants assets to Prime Infra, followed by Lopez Inc.’s acquisition of a 40 percent stake in Prime Infra’s hydropower business—later reduced to 33 percent. The majority bloc questioned the strategic rationale, particularly the loss of veto power that could have been retained with a slightly higher stake.
Prime Infra controls the Malamapaya natural gas field, whose primary market are the power plants owned by First Gas in Batangas. Prime Energy, a unit of Prime Infra, recently announced additional reserve for the Malampaya field.
The stake shifts—from controlling to minority positions—can significantly alter governance influence and long-term value capture, especially in capital-intensive sectors like energy. Questions on valuation, deal structure, and potential control premiums have also surfaced, reflecting broader concerns on capital allocation discipline were also raised by the Gabby Lopez bloc.
The board of Lopez Inc., composed mainly of cousins, in a 5-2 vote, earlier removed Piki as president and CEO for alleged loss of trust, although he remains in position after securing a court injunction. The legal standoff adds complexity to governance at the privately-held parent of several listed and unlisted firms.
In a supplemental motion filed before the Mandaluyong Regional Trial Court, the Gabby Lopez bloc also sought the immediate revocation of the injunctive order, arguing that it is being used to influence routine corporate functions across other companies within the Lopez Group, including Lopez Holdings Corporation, where Lopez Inc. does not hold shares.
In a statement issued on Sunday, First Gen sought to distance itself from the dispute, emphasizing that all transactions were approved unanimously by its board and underwent rigorous evaluation. The listed firm also highlighted sustained profitability under current leadership, with roughly $2 billion in earnings over the past five years.
While the audit push signals a demand for greater transparency, it also underscores the challenges of aligning strategic direction within large family-controlled conglomerates navigating major energy transitions and infrastructure investments.
