Posted on 09:33 PM, July 19, 2010
Business World
DAVAO CITY -- Air Philippines Express is resuming its daily flights to this city on Wednesday and will have three low-fare Davao-Manila flights starting in October, company officials said.
Air Philippines Boeing 737 -- www.wikipedia.org“We are a low-cost airline but that does not mean that we are the cheapest,” said Maria R. Java, marketing, media, e-commerce and product head of the company.
“We assure our customers that they will get the value of their money,” she added.
The company suspended its Davao operations on Oct. 1, 2009 due to economic reasons. With the resumption of the Davao flights, Air Philippines is offering an P800 fare for its Davao-Manila route and P600 for its Cebu-Manila route.
A regular discounted ticket for a Davao-Manila flight costs about P2,500.
Ms. Java said the airline has invested heavily in its fleet. The fleet includes two 180-seater Airbus A320s with one servicing the Davao-Manila route.
Some of its aircraft, particularly the Q300s and Q400s, are slightly older but are well-maintained, she added.
The budget airline will add six Airbus A320 units next year, said Snooker D. Jaranilla, company sales head, adding it hopes to double its destinations from 24 this year to 48 next year.
Air Philippines is also looking at servicing the Manila-Singapore route, Mr. Jaranilla said.
Ms. Java added that the company, a sister firm of Philippine Airlines which has five daily flights from this city, is finalizing its plan to make the Davao International Airport its Mindanao hub.
“We might launch the [Davao] hub next year,” she said.
If this plan pushes through, the company will consider the possibility of servicing the Davao-Singapore and the Davao-Malaysia routes.
Ms. Java said the company has been studying these routes as it continues to look for other Mindanao routes to service.
“We want to be part of the community. We want to be known as a community-based airline,” she added, pointing out that the re-launching of the company did not only mean a repackaging but also a change in the management team.
“Air Philippines Express is in a unique position. We have a history of deliberate attentive service to uphold yet we intend to meet our customers’ expectations of efficiency, as is expected by most businesses today,” she said.
The company figured in an accident on April 19, 2000 when Flight 541 from Manila to Davao crashed on Samal Island, killing all 131 people on board.
Considered the worst plane crash in this part of the world, it was blamed on a 20-year-old aircraft leased from an American firm.
Three years ago, an out-of-court settlement resulted in an agreement that gave out roughly $1 million in cash for each of the family’s victims. -- Carmelito Q. Francisco |
Monday, July 19, 2010
PAL sees clearer skies ahead as recovery holds
First posted 00:49:58 (Mla time) July 19, 2010
Paolo Montecillo
Philippine Daily Inquirer
MANILA, Philippines—Flag carrier Philippine Airlines (PAL) is seeing clearer skies ahead as a result of a steady, albeit modest, recovery in the local and international aviation market.
PAL president and chief operating officer Jaime J. Bautista said the company has experienced a slight rebound, in line with the recovery of airlines around the world as a result of the improvement in global economic prospects.
The resulting improvement in the company’s cash flow, Bautista said, helped PAL repay $46.5 million in loans that matured last month.
“We were able to pay that entire amount because we have implemented a lot of initiatives to raise cash and reduce costs,” he told reporters.
“The projection of the industry is a better 2010 and 2011. We are seeing a semblance of the market moving toward that direction,” Bautista said.
But he said the Lucio Tan-led firm would remain cautious due to the several challenges the local airline industry continued to face.
“We don’t want to call it a full recovery. We still have a lot of problems. There is the category 2 status and the European blacklist,” he said.
Bautista was referring to the US Federal Aviation Authority’s downgrade of the Philippines to category 2 status due to concerns over the country’s air safety standards. The downgrade bars Philippine carriers from expanding operations in the United States, which only affects PAL, being the only airline that flies to North America.
The European Union has also put the Philippines on a blacklist of countries whose airlines are banned from flying to the continent due to poor safety procedures.
“Although the market is improving, we still have to look for ways to cut costs and boost revenues,” Bautista said.
One way the company plans to reduce expenses is by sub-contracting its non-core tasks, including catering and airport services, to third party providers.
The labor department earlier ruled the controversial move, which will affect close to 3,000 employees, as a legal exercise of management prerogative. PAL workers have appealed the decision.
PAL posted a $40.2-million net loss in the April-December period of 2009, which is the first three quarters of the company’s fiscal year. Bautista said PAL would release its full-year financial results this week.
Paolo Montecillo
Philippine Daily Inquirer
MANILA, Philippines—Flag carrier Philippine Airlines (PAL) is seeing clearer skies ahead as a result of a steady, albeit modest, recovery in the local and international aviation market.
PAL president and chief operating officer Jaime J. Bautista said the company has experienced a slight rebound, in line with the recovery of airlines around the world as a result of the improvement in global economic prospects.
The resulting improvement in the company’s cash flow, Bautista said, helped PAL repay $46.5 million in loans that matured last month.
“We were able to pay that entire amount because we have implemented a lot of initiatives to raise cash and reduce costs,” he told reporters.
“The projection of the industry is a better 2010 and 2011. We are seeing a semblance of the market moving toward that direction,” Bautista said.
But he said the Lucio Tan-led firm would remain cautious due to the several challenges the local airline industry continued to face.
“We don’t want to call it a full recovery. We still have a lot of problems. There is the category 2 status and the European blacklist,” he said.
Bautista was referring to the US Federal Aviation Authority’s downgrade of the Philippines to category 2 status due to concerns over the country’s air safety standards. The downgrade bars Philippine carriers from expanding operations in the United States, which only affects PAL, being the only airline that flies to North America.
The European Union has also put the Philippines on a blacklist of countries whose airlines are banned from flying to the continent due to poor safety procedures.
“Although the market is improving, we still have to look for ways to cut costs and boost revenues,” Bautista said.
One way the company plans to reduce expenses is by sub-contracting its non-core tasks, including catering and airport services, to third party providers.
The labor department earlier ruled the controversial move, which will affect close to 3,000 employees, as a legal exercise of management prerogative. PAL workers have appealed the decision.
PAL posted a $40.2-million net loss in the April-December period of 2009, which is the first three quarters of the company’s fiscal year. Bautista said PAL would release its full-year financial results this week.
Lucio Tan to cut stake in PAL
Monday, 19 July 2010 00:00
BY DARWIN G. AMOJELAR SENIOR REPORTER
The Manila Times
PHILIPPINE Airlines Inc. (PAL) is in talks with several fund managers and Asian carriers for possible investment in the Lucio Tan-owned company. “The shareholders want [investors] to inject fresh capital. So, PAL will not get from the shareholders.
That’s the structure that we are looking at rather than the shareholders selling their shares,” Jaime Bautista, the flag carrier’s president told reporters on Friday.
“We will issue new shares—that’s the ideal. It’s possible through PAL Holdings Inc.,” he added.
PAL Holdings owns 84.7 percent of the flag carrier.
Bautista said Tan’s stake may be diluted if the tobacco tycoon decides not to infuse additional capital into the firm.
“It’s okay with him [Tan] as long as the money will go to PAL,” Bautista said.
In 1998, Hong Kong-based Cathay Pacific Airways Ltd. had contemplated on investing P4 billion in PAL but the plan failed to materialize because of “major differences.”
The Philippine carrier sought rehabilitation in 1998 after racking up $2.12 billion in debts.
Bautista said Cathay and the International Airline of United Arab Emirates were not among the carriers that PAL is in discussions with.
PAL Holdings’ shares have been climbing, from P3 at the start of the month to P4.85 on Friday, as rumors circulated that new investors were about to come in. On July 14, its shares hit P5.20.
Despite financial difficulties, PAL settled $40 million in maturing debts last month, on top of the $10 million it has been paying monthly, Bautista said.
The 69-year-old airline was able to bring down its liabilities to about $1 billion since entering corporate receivership. The company emerged from receivership after recording a profit in 2007.
But the airline’s finances spiraled in the succeeding three years as it incurred over $350 million, or at least P15 billion, in losses during its last two fiscal years.
Its equity also dropped precipitously to a little over $1.1 million as of February this year, the airline said.
Because of this, the company decided to let go of at least 3,000 employees with the spin-off of its three core businesses.
The affected workers belong to the in-flight catering services, airport services (including ground handling, cargo terminal/cargo handling, and ramp handling) and call center reservations.
Although the industry is improving, Bautista said PAL has “to continue implement[ing] more measures to generate more revenues and reduce costs.”
Besides its debts, the airline is also dealing with the problems brought about by the Philippines’ Category 2 rating by the US Federal Aviation Administration and the blacklisting by the European Union. These sanctions barred PAL from flying to these important destinations.
On top of these, the company also needs to tackle manpower problems, especially with pilots, “because of the industry’s increased capacity,” Bautista said.
BY DARWIN G. AMOJELAR SENIOR REPORTER
The Manila Times
PHILIPPINE Airlines Inc. (PAL) is in talks with several fund managers and Asian carriers for possible investment in the Lucio Tan-owned company. “The shareholders want [investors] to inject fresh capital. So, PAL will not get from the shareholders.
That’s the structure that we are looking at rather than the shareholders selling their shares,” Jaime Bautista, the flag carrier’s president told reporters on Friday.
“We will issue new shares—that’s the ideal. It’s possible through PAL Holdings Inc.,” he added.
PAL Holdings owns 84.7 percent of the flag carrier.
Bautista said Tan’s stake may be diluted if the tobacco tycoon decides not to infuse additional capital into the firm.
“It’s okay with him [Tan] as long as the money will go to PAL,” Bautista said.
In 1998, Hong Kong-based Cathay Pacific Airways Ltd. had contemplated on investing P4 billion in PAL but the plan failed to materialize because of “major differences.”
The Philippine carrier sought rehabilitation in 1998 after racking up $2.12 billion in debts.
Bautista said Cathay and the International Airline of United Arab Emirates were not among the carriers that PAL is in discussions with.
PAL Holdings’ shares have been climbing, from P3 at the start of the month to P4.85 on Friday, as rumors circulated that new investors were about to come in. On July 14, its shares hit P5.20.
Despite financial difficulties, PAL settled $40 million in maturing debts last month, on top of the $10 million it has been paying monthly, Bautista said.
The 69-year-old airline was able to bring down its liabilities to about $1 billion since entering corporate receivership. The company emerged from receivership after recording a profit in 2007.
But the airline’s finances spiraled in the succeeding three years as it incurred over $350 million, or at least P15 billion, in losses during its last two fiscal years.
Its equity also dropped precipitously to a little over $1.1 million as of February this year, the airline said.
Because of this, the company decided to let go of at least 3,000 employees with the spin-off of its three core businesses.
The affected workers belong to the in-flight catering services, airport services (including ground handling, cargo terminal/cargo handling, and ramp handling) and call center reservations.
Although the industry is improving, Bautista said PAL has “to continue implement[ing] more measures to generate more revenues and reduce costs.”
Besides its debts, the airline is also dealing with the problems brought about by the Philippines’ Category 2 rating by the US Federal Aviation Administration and the blacklisting by the European Union. These sanctions barred PAL from flying to these important destinations.
On top of these, the company also needs to tackle manpower problems, especially with pilots, “because of the industry’s increased capacity,” Bautista said.
EU unmoved by PAL pleas to lift ban
First posted 21:59:57 (Mla time) July 19, 2010
Paolo Montecillo
Philippine Daily Inquirer
THE EUROPEAN Union (EU) has refused to remove the Philippines from a list of countries whose airlines are banned from flying to the continent due to the lack of substantial industry-wide reforms in their local aviation sector.
Philippine Airlines said it was able to convince EU officials that PAL was of international standards. However, the company’s pleas to be excluded from the ban fell on deaf ears.
“We made a presentation to the EU last June and we were able to convince them that we are a safe airline,” PAL president and chief operating officer Jaime J. Bautista said in a recent interview.
“But they told us they were sorry and they could not give in to our request to be taken out of the blacklist,” he said.
The ban stemmed from a recent audit by the International Civil Aviation Organization (Icao), whose officials raised “serious safety concerns” over the state of the country’s aviation sector.
Particularly, the Icao pointed out the lack of professionalism within the Civil Aviation Authority of the Philippines (CAAP), which was tasked to make sure that local airlines were safe to fly.
Following the poor grade received from Icao, Philippine carriers were thrown into a blacklist of airlines banned from flying to Europe.
The CAAP, now under the leadership of former Manila airport manager Alfonso Cusi, has started to implement reforms since then, including the grounding of several aircraft found to have fallen short of international safety norms.
Bautista said that although PAL has no flights to Europe at the moment, the ban kept the airline from making plans to revive operations in the continent. Before being forced into rehabilitation in the late 1990s, PAL used to have flights to popular cities like London, Rome and Paris.
Bautista likewise said that as a result of the ban, European travel agencies have stopped selling PAL tickets to tourists who may want to take the flag carrier to visit attractions in the Philippines.
PAL is also the only local airline that has the aircraft capable of going on long-haul flights to Europe.
Aside from the EU ban, the Philippines was also downgraded to a category 2 status by the US Federal Aviation Authority (FAA). Again, the low grade only affected PAL, being the only airline that flies to North America.
Paolo Montecillo
Philippine Daily Inquirer
THE EUROPEAN Union (EU) has refused to remove the Philippines from a list of countries whose airlines are banned from flying to the continent due to the lack of substantial industry-wide reforms in their local aviation sector.
Philippine Airlines said it was able to convince EU officials that PAL was of international standards. However, the company’s pleas to be excluded from the ban fell on deaf ears.
“We made a presentation to the EU last June and we were able to convince them that we are a safe airline,” PAL president and chief operating officer Jaime J. Bautista said in a recent interview.
“But they told us they were sorry and they could not give in to our request to be taken out of the blacklist,” he said.
The ban stemmed from a recent audit by the International Civil Aviation Organization (Icao), whose officials raised “serious safety concerns” over the state of the country’s aviation sector.
Particularly, the Icao pointed out the lack of professionalism within the Civil Aviation Authority of the Philippines (CAAP), which was tasked to make sure that local airlines were safe to fly.
Following the poor grade received from Icao, Philippine carriers were thrown into a blacklist of airlines banned from flying to Europe.
The CAAP, now under the leadership of former Manila airport manager Alfonso Cusi, has started to implement reforms since then, including the grounding of several aircraft found to have fallen short of international safety norms.
Bautista said that although PAL has no flights to Europe at the moment, the ban kept the airline from making plans to revive operations in the continent. Before being forced into rehabilitation in the late 1990s, PAL used to have flights to popular cities like London, Rome and Paris.
Bautista likewise said that as a result of the ban, European travel agencies have stopped selling PAL tickets to tourists who may want to take the flag carrier to visit attractions in the Philippines.
PAL is also the only local airline that has the aircraft capable of going on long-haul flights to Europe.
Aside from the EU ban, the Philippines was also downgraded to a category 2 status by the US Federal Aviation Authority (FAA). Again, the low grade only affected PAL, being the only airline that flies to North America.
Lucio Tan seeks new investors in capital-starved PAL
by Jenniffer B. Austria
July 19, 2010
Manila Standard Today
BEER and tobacco tycoon Lucio Tan is willing to reduce his stake in Philippine Airlines to accommodate fresh capital from potential investors, an official said over the weekend.
Tan would not be selling his shares, but instead the airline would be offering new shares to obtain new capital, company president Jaime Bautista said. That meant Tan’s shares in the airline would be diluted, he said.
“We are looking at fresh equity that will go directly to PAL,” Bautista said, but stressed that Tan wanted to keep majority control of the company while opening the carrier to new investors. Tan owns over 90 percent of the airline.
“The preference is for Mr. Tan to maintain majority control of the airline,” Bautista said. He said the company was now talking to potential foreign investors but refused to identify them.
The airline’s shareholders last year approved a quasi-reorganization plan to attract new investors. The plan is to reduce the par value of its shares to P0.20 from P0.80 a share, and then to increase its authorized capital stock from P16 billion to P20 billion divided into 100 billion shares at P0.20 a share.
PAL started entertaining talks with potential investors in a bid to boost the airline’s finances, which have deteriorated over the past two years as a result of the global financial crisis, stiff competition from low-cost airlines, and rising fuel costs.
The airline reported a net loss of $40.2 million in the first nine months of its fiscal year ending December 2009, an improvement from the $330.2 million it lost a year earlier. The company’s revenues rose 15 percent to $1.08 billion, but its expenses amounted to $1.1 billion.
To reduce costs, the flag carrier earlier disclosed plans to offer early retirement packages to its 8,000 employees and to reduce the number of flights to its long-haul destinations, and in particular the United States, Australia and Canada.
Sources within the airline said the carrier lost $14.3 million in its fiscal year ending March 2010, a reduction from the previous year’s loss of $297.8 million.
They said lower fares and weak passenger demand from its international operations drove revenues down to $1.36 billion from $1.60 billion.
Worldwide capacity cuts during the year did not keep pace with declining traffic demand, hence exerting significant pressure on fares and yields, the sources said.
July 19, 2010
Manila Standard Today
BEER and tobacco tycoon Lucio Tan is willing to reduce his stake in Philippine Airlines to accommodate fresh capital from potential investors, an official said over the weekend.
Tan would not be selling his shares, but instead the airline would be offering new shares to obtain new capital, company president Jaime Bautista said. That meant Tan’s shares in the airline would be diluted, he said.
“We are looking at fresh equity that will go directly to PAL,” Bautista said, but stressed that Tan wanted to keep majority control of the company while opening the carrier to new investors. Tan owns over 90 percent of the airline.
“The preference is for Mr. Tan to maintain majority control of the airline,” Bautista said. He said the company was now talking to potential foreign investors but refused to identify them.
The airline’s shareholders last year approved a quasi-reorganization plan to attract new investors. The plan is to reduce the par value of its shares to P0.20 from P0.80 a share, and then to increase its authorized capital stock from P16 billion to P20 billion divided into 100 billion shares at P0.20 a share.
PAL started entertaining talks with potential investors in a bid to boost the airline’s finances, which have deteriorated over the past two years as a result of the global financial crisis, stiff competition from low-cost airlines, and rising fuel costs.
The airline reported a net loss of $40.2 million in the first nine months of its fiscal year ending December 2009, an improvement from the $330.2 million it lost a year earlier. The company’s revenues rose 15 percent to $1.08 billion, but its expenses amounted to $1.1 billion.
To reduce costs, the flag carrier earlier disclosed plans to offer early retirement packages to its 8,000 employees and to reduce the number of flights to its long-haul destinations, and in particular the United States, Australia and Canada.
Sources within the airline said the carrier lost $14.3 million in its fiscal year ending March 2010, a reduction from the previous year’s loss of $297.8 million.
They said lower fares and weak passenger demand from its international operations drove revenues down to $1.36 billion from $1.60 billion.
Worldwide capacity cuts during the year did not keep pace with declining traffic demand, hence exerting significant pressure on fares and yields, the sources said.
Sunday, July 18, 2010
Court denies PAL’s bid to refund taxes on interest earnings
July 18, 2010
Business World
THE COURT of Tax Appeals has denied Philippine Airlines’ (PAL) claim for a refund of some P4 million in taxes withheld by banks, as there was supposedly no evidence the amount had been remitted to the government.
PHILIPPINE Airlines is asserting its tax perks under Presidential Decree No. 1590, which requires it to pay only the corporate income tax or a 2% tax on gross revenues, whichever is lower. -- Bw file photoIn a ruling last May 11, the tax court said certifications from seven banks in which PAL had accounts were not corroborated by documents from the Bureau of Internal Revenue (BIR).
The Lucio C. Tan-led carrier wanted P3,621,067.51 in interest income refunded, citing tax perks under its franchise. The amount was withheld from peso and US dollar bank accounts, representing 20% and 7.5% in final income taxes in 2003.
“It bears stressing that equally important to petitioner PAL’s claim for refund is evidence showing that the taxes withheld from petitioner PAL’s interest income [was] actually remitted to the BIR,” the court ruling said.
Under Presidential Decree (PD) No. 1590, PAL was granted a legislative franchise that exempted it from taxes, including withholding taxes. In lieu of the exemption, PAL was made to pay either the corporate income tax or a franchise tax of 2% of gross revenues, “whichever will result in lower tax.”
The court, in its ruling, recognized this right of the airline, but said lack of documents failed PAL’s claim for a tax refund.
To prove that it had earned interest income on its bank deposits, PAL presented as evidence certifications and certificates of final tax from seven banks worldwide, namely: Tan-led Allied Banking Corp., China Banking Corp., Hong Kong Shanghai Banking Corp., JP Morgan Chase Bank, Land Bank of the Philippines, Standard Chartered Bank, and Philippine Bank of Communications.
PAL claimed that a total of P203,260.34 and $62,311.89 worth of final taxes were withheld by the seven banks, court records showed.
The tax court said PAL should not only establish its rightful claim to a refund, but also the exact amount of refund it was seeking.
“Without supporting documents to prove that the amount PAL is claiming for refund had in fact been remitted to the BIR, this court cannot determine the exact amount refundable to [the airline] by reason of its exemption from all other taxes,” the ruling said.
“This court can order [the BIR] refund to petitioner PAL only the amount of taxes duly withheld and actually remitted to the government,” the decision said.
On Feb. 4, the Supreme Court reversed an earlier decision by the tax court, ordering the refund of P141,431 representing the 10% overseas communication tax it had paid to Philippine Long Distance Telephone Co. on overseas calls in 2002.
The Supreme Court also cited PD 1590 as basis for its ruling. -- P. P. Magtulis
Business World
THE COURT of Tax Appeals has denied Philippine Airlines’ (PAL) claim for a refund of some P4 million in taxes withheld by banks, as there was supposedly no evidence the amount had been remitted to the government.
PHILIPPINE Airlines is asserting its tax perks under Presidential Decree No. 1590, which requires it to pay only the corporate income tax or a 2% tax on gross revenues, whichever is lower. -- Bw file photoIn a ruling last May 11, the tax court said certifications from seven banks in which PAL had accounts were not corroborated by documents from the Bureau of Internal Revenue (BIR).
The Lucio C. Tan-led carrier wanted P3,621,067.51 in interest income refunded, citing tax perks under its franchise. The amount was withheld from peso and US dollar bank accounts, representing 20% and 7.5% in final income taxes in 2003.
“It bears stressing that equally important to petitioner PAL’s claim for refund is evidence showing that the taxes withheld from petitioner PAL’s interest income [was] actually remitted to the BIR,” the court ruling said.
Under Presidential Decree (PD) No. 1590, PAL was granted a legislative franchise that exempted it from taxes, including withholding taxes. In lieu of the exemption, PAL was made to pay either the corporate income tax or a franchise tax of 2% of gross revenues, “whichever will result in lower tax.”
The court, in its ruling, recognized this right of the airline, but said lack of documents failed PAL’s claim for a tax refund.
To prove that it had earned interest income on its bank deposits, PAL presented as evidence certifications and certificates of final tax from seven banks worldwide, namely: Tan-led Allied Banking Corp., China Banking Corp., Hong Kong Shanghai Banking Corp., JP Morgan Chase Bank, Land Bank of the Philippines, Standard Chartered Bank, and Philippine Bank of Communications.
PAL claimed that a total of P203,260.34 and $62,311.89 worth of final taxes were withheld by the seven banks, court records showed.
The tax court said PAL should not only establish its rightful claim to a refund, but also the exact amount of refund it was seeking.
“Without supporting documents to prove that the amount PAL is claiming for refund had in fact been remitted to the BIR, this court cannot determine the exact amount refundable to [the airline] by reason of its exemption from all other taxes,” the ruling said.
“This court can order [the BIR] refund to petitioner PAL only the amount of taxes duly withheld and actually remitted to the government,” the decision said.
On Feb. 4, the Supreme Court reversed an earlier decision by the tax court, ordering the refund of P141,431 representing the 10% overseas communication tax it had paid to Philippine Long Distance Telephone Co. on overseas calls in 2002.
The Supreme Court also cited PD 1590 as basis for its ruling. -- P. P. Magtulis
Friday, July 9, 2010
San Miguel Corp. keen on acquiring majority stake in PAL
By Ma Elisa P. Osorio (The Philippine Star) Updated July 09, 2010 12:00 AM
MANILA, Philippines - Diversifying conglome-rate San Miguel Corp. (SMC) has expressed inte-rest in acquiring a controlling stake in flag carrier Philippine Airlines (PAL) from the Lucio Tan Group.
In an interview with reporters Wednesday evening, SMC president and chief operating officer Ramon S. Ang said, however, that they will only buy PAL if they can get at least 51 percent.
“We need to at least get 51 percent so that we are the majority. If not, then what is it for,” he said.
However, Ang said he expects Tan to sell PAL only to foreign companies. “It’s a pride thing. They will not sell to local companies. They will sell to a foreigner but not to locals.” Early this year, Tan surrendered control of his cigarette company Fortune Tobacco to Philip Morris.
When asked if they can make PAL more profitable, Ang said “the airline business is a very simple business,” adding they will definitely make more money for PAL.
In the same event, PAL president Jaime Bautista pointed out they have not yet discussed any plans of selling the flag carrier. “That matter has never been discussed in our meetings.”
Bautista noted that the airline is doing well and they are looking forward to a good year due to the opening of new flights.
But a source from PAL said a number of companies have been doing due diligence on the firm but the case between PAL and its workers have delayed the proceedings. The source noted that some companies are waiting for the final resolution of the labor problem. The source said although there are a number of firms that have expressed interest in buying PAL, they have been approaching the wrong people.
MANILA, Philippines - Diversifying conglome-rate San Miguel Corp. (SMC) has expressed inte-rest in acquiring a controlling stake in flag carrier Philippine Airlines (PAL) from the Lucio Tan Group.
In an interview with reporters Wednesday evening, SMC president and chief operating officer Ramon S. Ang said, however, that they will only buy PAL if they can get at least 51 percent.
“We need to at least get 51 percent so that we are the majority. If not, then what is it for,” he said.
However, Ang said he expects Tan to sell PAL only to foreign companies. “It’s a pride thing. They will not sell to local companies. They will sell to a foreigner but not to locals.” Early this year, Tan surrendered control of his cigarette company Fortune Tobacco to Philip Morris.
When asked if they can make PAL more profitable, Ang said “the airline business is a very simple business,” adding they will definitely make more money for PAL.
In the same event, PAL president Jaime Bautista pointed out they have not yet discussed any plans of selling the flag carrier. “That matter has never been discussed in our meetings.”
Bautista noted that the airline is doing well and they are looking forward to a good year due to the opening of new flights.
But a source from PAL said a number of companies have been doing due diligence on the firm but the case between PAL and its workers have delayed the proceedings. The source noted that some companies are waiting for the final resolution of the labor problem. The source said although there are a number of firms that have expressed interest in buying PAL, they have been approaching the wrong people.
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