The largest shareholder of Philippine Airlines Inc. jumped essentially the most in greater than five years after Nikkei reported that ANA Holdings Inc. is considering investing in a carrier from Southeast Asia.
Japan’s largest airline ANA is considering buying 10 percent of Philippine Airlines for 10 billion yen ($91 million), Nikkei reported on Tuesday. PAL Holdings Inc., the bulk owner of Philippine Airlines, was trading higher in Manila on Wednesday, its biggest gain since July 2013. The benchmark Philippine share index fell 0.2%.
ANA is in talks with PAL Holdings, but no concrete decision has been made yet, the Japanese company said in an emailed response. The largest shareholder of Philippine Airlines Inc. jumped essentially the most in greater than five years after Nikkei reported that ANA Holdings Inc. is considering investing in a carrier from Southeast Asia.
Philippine Airlines is in talks with potential investors and the transaction may happen in the primary half of the 12 months, PAL president Jaime Bautista said by phone, adding that he could neither confirm nor deny the reports, citing confidentiality agreements signed with the parties.
The investment in PAL, controlled by billionaire Lucio Tan, provided Philippine Airlines with the resources to expand in a market where a lot of low-cost carriers over the past decade have encouraged more people to fly for business and leisure. ANA is keen to expand its reach within the region after many years of near-duopoly in Japan, where an aging population threatens to cut back the number of individuals traveling by air.
San Miguel Corporation, led by Ramon Ang, controlled 49% of PAL until Lucio Tan’s group bought back the shares in 2014. PAL, led by Tan, announced a couple of weeks later that it was searching for foreign investors to assist run the then-troubled airline.
Later that 12 months, PAL and ANA signed an agreement covering codeshare and frequent flyer programs.
In 2015, PAL Holdings president and chief operating officer Jaime Bautista said his goal was to draw a foreign investor by 2017, which might effectively help it achieve the airline’s most coveted five-star rating from London’s Skytrax.
Fast forward and the talks are still ongoing.
ANA, Japan’s largest airline, was founded in 1952 and has had a five-star airline rating since 2013. The fleet consists of 260 aircraft and carried 53.8 million passengers in 2017. In the past, ANA has also been named 10-year Airline of the Year 3 times.
PAL is modernizing its fleet by 2024, aiming to develop into a five-star airline. Currently, it’s the primary and only four-star airline within the Philippines.
PAL recently expanded its services to other key cities in Southeast Asia and launched long-haul flights to New York. Aircraft that can join the PAL fleet in 2019 include two more next-generation Q400s, two A350s and two more A321neos.
Source: Bloomberg.com | Rappler.com
