Tycoon Lucio Tan
MANILA, Philippines — Tycoon Lucio Tan gave a sly, mischievous grin when asked about his succession plan for his multibillion-dollar empire in the Philippines.
“I will look for an entrepreneur who would like to buy (and) I will sell (everything),” Tan said, seemingly in jest and with an enigmatic smile.
He turned serious, but smiled again when asked if he meant what he just said and broke into an even brighter smile when asked if he was kidding.
Only Tan knows for sure what he will do, but he assured he, indeed has a succession plan.
What is certain is that he is visibly happy with how his business has grown to where it is now.
“I am happy,” he said.
Tan’s vast empire spans a wide range of businesses — from cigarettes, to skyscrapers to Greek style yoghurt — and it has made him the fourth richest man in the country with a net worth of $4.2 billion, according to Forbes.
At 83, he no longer runs the day-to-day operations of his various companies and is now able to relax. He wakes up at 4 a.m. everyday to play golf; tries to take naps in the morning and afternoon and graces cocktail parties every now and then.
His son Michael runs the business as president and chief operating officer of LT Group Inc., his publicly-listed conglomerate.
On the occasion of his Chinese birthday last week, Tan shared bits and pieces of his life story in between bites of some of his favorite dishes — stir-fried vegetables and steamed yellow tail fish. He drank freshly squeezed carrot juice and had fresh fruits for dessert.
His birthday wish?
“Easy, easy life.”
It’s a wish that’s already fulfilled. Tan, after all, is now enjoying the fruits of his labor.
But while he is a decade younger than his fellow tycoons, such as 92-year old Henry Sy, Tan said time is running fast and he would soon be just as old.
“Ten years – it’s just a moment,” he said over lunch in his favorite room at Century Tsukiji restaurant in Malate, Manila.
But Tan, who watches what he eats, looks healthy at his age.
His mind is still sharp – too sharp in fact that he dodges questions perfectly well. His wit is unmatched and his humor will make you fall off your seat.
He walks unaided, reads without eyeglasses, keeps pieces of paper for his reminders and jots down things he likes to remember. In his pocket are four identical vintage Nokia phones.
Someone in his shoes would certainly be a happy man. Tan, after all, has successfully built an empire from scratch and stirred it to become one of the biggest in the country.
His success is legendary. As the late Jaime Cardinal Sin once said, the life story of Tan is like the proverbial mustard seed: “it began small, but emerged bigger than most, of the shrubs and trees.”
A migrant from Fujian, China, he worked his way through college and earned a bachelor’s degree in Chemical Engineering from the Far Eastern University.
His first job was in the factory of Bataan Cigar where he learned the ropes of the cigarette business.
He then started his own cigarette company, Fortune Tobacco, which would become the country’s biggest cigarette firm before venturing into banking, liquor, airlines and property.
And the rest, as they say, is history.
For the longest time, he has been the country’s richest man until Sy overtook him in the Forbes annual list of the Philippines’ richest.
But Tan shrugs off the billionaire tag and is seemingly bewildered on how he even landed on the list.
At one point when he was talking about his fellow tycoons, he mentioned David Consunji, the construction magnate who recently passed away.
“He is very rich,” Tan said of Consunji.
“But sir, you are richer, according to Forbes. You are the number four richest man and Consunji is the number six,” The STAR said.
“Whoa! Ako? I wish, I wish. I wish it will come true,” he quipped with a wide smile.
Asked about his secrets to success, Tan said there’s none.
“There’s no secret, just work hard,” said Tan who was raised in the Confucian work ethic – to aim high and reach his goals through hard work.
He was particularly engrossed with the value of “ren,” the Chinese word for perseverance and the virtues of humility, frugality and benevolence.
Tan didn’t talk much about his specific companies, but said “no” when asked if he would sell Philippine National Bank, the country’s fifth largest lender, or Philippine Airlines (PAL), his flagship carrier.
“I don’t like to sell. I have no other business,” he said.
On the entry of a strategic partner in PAL, Tan said he would wait for the airline to make more money.
“For Philippine Airlines, somebody likes to invest. We can allow them to participate,” he said, but declined to name the potential investors.
“Airlines are very competitive,” he added.
Tan’s businesses are beverage, property, banking, tobacco, distilled spirits and airlines.
In recent years, he has opened his vast empire to partners including erstwhile competitors and will continue to do so as part of the strategy to grow the business.
In all, the taipan’s businesses under LT Group are now mostly comprised of several partnerships.
These include AB Heineken Philippines Inc., the partnership between Asia Brewery Inc. and Dutch beer giant Heineken; PMFTC Inc, the business combination between US tobacco giant Philip Morris and Fortune Tobacco Corp., and ABI Pascual Holdings Pte. Ltd., which is between Asia Brewery and Calidad Pascual of Spain.
The conglomerate remains open to partnerships.
“If it’s strategic and if it would add value,” Michael told The STAR in June after the company’s annual stockholders’ meeting.
Analysts said the move to take in partners bodes well for Tan’s businesses because the investors are experts in their field.
“The partnerships allow them to bring in well known products and increase shareholder value, especially because the partners are big names in their fields,” said Justino Calaycay, analyst at Philstocks Financials Inc.
It could also be a succession strategy wherein Tan would continue to own the business, but leave management to professionals, he added.
New business partners may indeed be possible, but Tan said he is already happy with the composition of his empire and has no plans to add a new leg.
But outside the business, he would like to do more to improve the quality of education in the country, he said.
“Every year I send 1,000 students to China to study Chinese history, language and culture,” Tan shared with pride.
He is the founder of the non-profit Foundation for Upgrading the Standard of Education (FUSE), which helps upgrade the quality of education in the country by improving the teaching skills of English, science and mathematics teachers. He has also been helping build schoolhouses all over the country in the last three decades.
For Tan it’s not all about business. He gets all excited when talking about education and is proud of what he has done to help Filipino students.
Indeed, it’s quite a fulfilled life for Tan.
After almost two hours of sharing vignettes of his life, the birthday celebrator stood up, gave away dozens of the lucky fruit kiat kiat and said goodbye.
He will have more birthday festivities throughout the day and later that evening and dozens more kiat kiats to share.
There’s a lot to celebrate after all, for the man called Kapitan.
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Tycoon Lucio Tan