PALTask Force Report Rushed

People’s Journal

Monday, December 28, 1998

THE TASK force formed by the Se­curities and Exchange Commission to evaluate the rehabilitation plan submitted by cash-strapped Philippine Airlines is expected to submit its findings and recommendation by January 7, according to Jaime Bautista, PAL Senior Vice President and Chief Finance Officer.

The SEC panel hearing the PAL case is com­posed of acting SEC Chairman Fe Eloisa C. Gloria, lawyers Ysobel Yasay-Murillo and Josefina Pasay-Paz.

The SEC convened the task force last June 19, 1998 to assist the hearing panel in the PA L proceedings before the SEC Securities Investigation and Clearing Department.

The task force, composed of Jesus Ulanday, Monolito Soller, and Rosita Guerrero was or­dered to study and analyze the rehabilitation plan.

Ulanday is the chief of the Field Audit and Analy­sis Division of the Exam­iners and

Appraiser De­partment; Soller is a lawyer from the en banc division; and Guerrero, also a lawyer from the SICD.

Bautista said PAL's creditors have asked sev­eral questions about PAL’s rehabilitation program.

The query and clarification for the rehabilitation of the ailing airline company came mostly from creditor banks led by European export credit agencies through French Bank Credit Agicole Indosuez.

Of the local bank credi­tor, PNB has the biggest exposure. Other local creditors are Allied Banking Corp., China Bank­ing Corp., PCI Bank, RCBC, Equitable Bank, Union Bank, Security Bank, Westmont Bank, International Exchange Bank, Banco de Oro, Urban Bank, Land Bank of the Philippines, UCPB, GSIS, and the Bureau of Treasury.

PAL wants an injection of $150 million additional capital by share holders as part of the financial restructuring plan.

The value of common shares of PAL would be reduced from P5 per share to P0.01 per share. The shareholder equity injec­tion would comprise over 90 percent of the new eq­uity ownership of the company. PNP is objecting to this plan.

PAL operations have been scaled down to key profitable international and domestic routes. Personnel have been reduced from 12,986 in May 1998 to 8,589 as of Nov. 7, 1998. Ellie Mallorca