Manila Bulletin

Tan consolidat­es airline holdings to entice investors

- By NORMAN P. AQUINO (Bloomberg)

Philippine tycoon Lucio Tan will consolidat­e his airline ventures as he focuses on expanding his flagship PAL Holdings, Inc. and increase its appeal to potential buyers.

PAL will acquire another company owned by Tan called Zuma Holdings & Management Corp. through a shareswap agreement, valuing the whole deal at R8.24 billion ($166 million), the company said in a stock exchange filing Friday. The purchase will consolidat­e Philippine Airlines, Inc. and budget carrier Air Philippine­s Corp.

“The integratio­n of both businesses into a single organizati­on structure would make PAL a more viable investment for interested investors,” PAL said in the statement. Consolidat­ing the two airlines will also reduce costs and increase revenue, it said.

Philippine Airlines is in talks with potential investors and is seeking one with experience in running carriers so it can help manage its fleet, the carrier’s President Jaime Bautista said in June. The company is also open to private equity funds and other strategic investors.

The reorganiza­tion comes as competitio­n intensifie­s among carriers in Asia Pacific, where a dozen new airlines started operations in the past decade.

“Consolidat­ing the airlines is very positive and will allow PAL to fetch a higher

 ??  ??

Newspapers in English

Newspapers from Philippines