Ram Felix Rengel, Jr.

Business Tycoon Lucio Tan

Lucio Tan is the richest industrialist in the Philippines, with a personal net worth of at least $1.5 billion. Known to be shrewd but secretive and reclusive, Tan has extensive investments in China and Hong Kong.

Over the past three decades, Lucio Tan single-handedly built an empire spanning the Philippines to Canada, all this while wheeling and dealing firmly behind closed doors.

Tan was born in China's Fujian province. His family moved to the Philippines when he was a child. He studied chemistry in Manila, but quit before graduating to take on a job in a tobacco factory. This prompted the nonsmoker to start his own cigarette company, Fortune Tobacco in 1966.

The company expanded rapidly, and the introduction of a budget brand, Hope, in 1975, raked in even greater wealth for Tan. In the 1970s, Tan secured permission from resident Marcos to establish a brewing business, Asian Breweries. It was the only brewery allowed to challenge the supremacy of San Miguel Corp, whose trademark beer dominates the local market.

In 1977, Tan acquired a defunct bank from the government, and revived it quickly. Now known as Allied Banking Corp, it is one of the top banks in the Philippines, and providing sound backing for Tan's foray into brewing and real estate.

In 1993, he secured control of Philippine Airlines PAL after a bitter ownership feud.

In the Philippines, businessmen often contribute significant amounts to support many different political campaigns, with the hope of gaining political favour in business no matter who wins the election. Ethnic Chinese businesspeople, denied the family links to power enjoyed by the Spanish-descended aristocracy, are some of the biggest campaign contributors.

Connections are undoubtedly an important factor behind Tan’s success. Tan’s close friend Joseph Estrada rose to become president. But Tan breaks the mold: he eschews contributing to a bunch of candidates and instead is a one-horse man. First, it was Marcos; then it was Estrada. Now Tan is calling some of the big plays for the government as he tries to keep his airline, Philippine Airlines, afloat.

Tan is also beginning to shed his cloak of secrecy in other ways. For years, he has held most of his companies privately. Now he is mulling whether to list his two biggest moneymakers -- Fortune Tobacco and Asian Breweries -- on the stock market.

In 1996 reclusive Philippine businessman Lucio Tan found himself all but untouched by an ongoing government probe into the legitimacy of his operations. Tan, who was accused of tax evasion and other unsavoury business practices that dated back to his association with Pres. Ferdinand Marcos during the 1960s and '70s, avoided conviction on any of the charges. As owner of the formerly state-owned Philippine Airlines Inc. (PAL) and with an estimated net worth between $1 billion and $8 billion, Tan was considered the richest man in the Philippines. The government, however, wanted to know just how much of his wealth had been obtained legally, although disclosure seemed unlikely at year's end.

Tan was born Tan Eng Tsai on July 17, 1933, in Amoy, Fujian province, China, the oldest of eight children. He earned a degree in chemical engineering from Far Eastern University, Manila. In one of his early jobs, he worked as a janitor in a cigarette factory before his promotion to tobacco "cook," regulating the product mix. In 1966 Tan started his own tobacco company, which by 1996 commanded nearly 75% of the Philippine market.

Tan and Marcos reportedly met in the early 1960s when Marcos was a senator. By 1972 their friendship had strengthened, and Marcos had already served seven years as president when he declared martial law and served as the catalyst for what would become three of the country's largest businesses. When Tan's Fortune Tobacco Corp. allegedly received tax breaks, it was able to beat its rivals. In 1977 Tan acquired the insolvent General Bank and Trust (later renamed Allied Banking Corp.) for a pittance, and three years later he launched Asia Brewery Inc. when Marcos rescinded a measure prohibiting the establishment of new beer companies. After the fall of Marcos, the administrations of Corazon Aquino and Fidel Ramos tried to prove that Tan's companies had been secretly owned by Marcos and therefore should be confiscated. In addition, it was alleged that Tan had not been duly assessed his fair share of taxes on his holdings. In August 1996, however, a Supreme Court ruling stated in essence that the tax bureau had prosecuted the matter in an improper manner.

In 1992, unbeknownst to the Aquino government, Tan had secretly financed the winning bid that secured the purchase of the newly privatized PAL. In January 1995 he became chairman of the airline, and in September 1996 he won a lengthy battle with PAL's corporate structure to take ruling control of the carrier. Two days later the House of Representatives approved a bill that favoured tax breaks for his beer and cigarette concerns. At year's end it appeared that Tan would move forward unscathed and could spend time grooming his three sons for business.

Born: July 17, 1934, in Amoy, Fujian province, China
Education: BS Chemical Engineering, Far Eastern University, Manila
Family: Married

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