The stake acquired by San Miguel Corporation, worth $500 million, is enough to secure management control over the airline. The deal has been approved in principle and the details are being worked out.
I wonder how this might affect PR, especially with San Miguel owning a significant stake in Petron (the Philippines' largest distributor of petroleum products; not saying "oil company" because oil exploration is still done by the PNOC). They might be able to get "cheaper" fuel.
Byrdluvs747 From United States of America, joined Jul 2004, 2425 posts, RR: 1
Reply 5, posted (2 years 7 months 4 weeks 17 hours ago) and read 4290 times:
I'm still becoming familiar with PR, and I know absolutely nothing about the San Miguel Corp. I know it's early, but can someone put this acquisition into perspective in regards to San Miguel's management style, and how it may affect PR?
The 747: The hands who designed it were guided by god.
Quote: "MANILA, Philippines—The Lucio Tan group and San Miguel Corp. announced Wednesday they have signed a deal under which SMC would acquire substantial shares in both Philippine Airlines and Air Philippines as well as management control of the two companies.
The disclosure did not provide details but SMC president Ramon Ang confirmed an Inquirer report on Tuesday that his group would acquire 49 percent of PAL Holdings, resulting in ownership of at least 40
percent of PAL.
In a joint statement, Tan and SMC president Ramon S. Ang said the new investment would 'allow the two airlines to strengthen operations and stay competitive with the implementation of PAL and Air Phil’s fleet modernization program.'
Ang said San Miguel welcomed 'the opportunity to participate in the refleeting and modernization plans of the two airlines'."
RWA380 From United States of America, joined Feb 2005, 3432 posts, RR: 5
Reply 10, posted (2 years 7 months 3 weeks 6 days 16 hours ago) and read 3469 times:
Quoting aerorobnz (Reply 2): Is that the same San Miguel that makes very good beer?? I like PR, I hope it allows them to really succeed and gain the necessary safety categories to recommence add to US & European routes
Would this new control have any effect, good or bad, on the attempt to get into EU skies, and add the rumored JFK flight, plus allow PR to send 777's to LAX, SFO, YVR & LAS? Is
AA AC AQ AS BD BN CO CS DL EA EZ HA HP KL KN MP MW NK NW OO OZ PA PS QX RC RH RW SA TG TW UA US VS WA WC WN
Devilfish From Philippines, joined Jan 2006, 4938 posts, RR: 1
Reply 12, posted (2 years 7 months 3 weeks 4 days 14 hours ago) and read 3136 times:
Quoting Akiestar (Thread starter):
I wonder how this might affect PR, especially with San Miguel owning a significant stake in Petron
From the link in #9.....
Quote: "'For Philippine Airlines, the entry of SMC may enhance its re-fleeting strategy given the cash-rich balance sheet of the acquiring conglomerate. The airline may also explore potential strategies with other key assets of SMC such as airport infrastructure and jet fuel access and pricing through Petron Corp.'.....
San Miguel is involved in the modernization of the Godofredo P. Ramos airport in Caticlan, the main gateway to the famous Boracay Island. This is the first privatized airport terminal operations in the Philippines. SMC has also expressed interest to participate in the public bidding for the public-private partnership contracts for other airports."
Quote: "In making this investment, SMC is betting on a heavy influx of tourists in the coming years which will be beneficial to the tourism industry.
'For SMC, the purchase completes the air transportation investment strategy of the company. The conglomerate is developing airports, toll roads leading to airports, and with PAL, an airline that already enjoys a significant market share.'"
Quoting airlineaddict (Reply 7): but I don't know how they will produce much better results with PR while the Philippines is Cat-2. Same with the difficult labor relations.
The capital infusion would help a lot in further streamlining PR's in-house procedures so they'd be all set to go once Cat 1 for the country is restored. It could also go a long way towards bettering the lives of their employees that they become committed partners in company building.
Quoting RWA380 (Reply 10): Would this new control have any effect, good or bad, on the attempt to get into EU skies, and add the rumored JFK flight, plus allow PR to send 777's to LAX, SFO, YVR & LAS?
No, insofar as the EAA and FAA are concerned. But its influence may be brought to bear for the local authorities to get their act together to regain Cat 1. It could be assumed that any new long-haul aircraft order and route expansion would be held in abeyance until Cat 1 status is assured.
Quote: "Philippine Airlines, which recently took in the San Miguel Corp as a new investor, is seen investing as much as $1 billion for a fleet modernization program that will make the storied flag carrier more competitive.
Industry sources explained that because SMC’s entry into PAL and AirPhil would involve the issuance of new shares, new money would flow into the carriers. For capital spending beyond $500 million, the source said the airlines could fund this through debt rather than equity so as not to disrupt the existing capital structure.
Based on the latest regulatory filing of PAL Holdings, the flag carrier has the following capital expenditure commitment for the medium term:
* PAL has a supplemental agreement with Boeing signed in 2007 relating to its exercise of purchase rights for two Boeing 777-300ER aircraft for delivery in fiscal year 2012.
* PAL and Boeing agreed in June 2009 to reschedule the deliveries of four Boeing 777-300ER aircraft from their original delivery schedules of fiscal year 2010, 2011 and 2012 to fiscal years 2013 and 2014.
* PAL signed in June last year operating lease agreements for the lease of two Airbus A320-200 aircraft for delivery in March and May 2012. A Letter of Intent was likewise signed in July 2011 for the lease of additional two Airbus A320-200 for delivery in October and November 2012."
Akiestar From Philippines, joined May 2009, 786 posts, RR: 0
Reply 17, posted (2 years 7 months 2 weeks 4 days 6 hours ago) and read 2169 times:
Just an update I read in the news a few days ago: Jaime Bautista will step down as PAL president, with Ramon Ang, chairman of San Miguel Corporation, replacing him. Bautista though will still sit on the board of PAL Holdings, and Lucio Tan will continue to sit as chairman.
I'll post the link when I'm on a computer: I'm posting this from my iPod Touch as my computer is currently bring repaired.