Flag carrier Philippine Airlines is open to taking in new investors, its top official said.

If this pushes through it will come on the heels of a big dilution in the stake of Japan's ANA Holdings in PAL following the carrier's Chapter 11 process in 2021.

'We are open (to it),' said PAL president and COO Capt. Stanley Ng when asked if PAL was looking for new investors.

He stressed, however, that the company is not in talks yet with any potential investor, but said that the airline has been attracting the interest of both local and foreign investors.

'A lot of investors have expressed interest,' Ng said.

The stake of Japan's ANA Holdings has been reduced to less than one percent after the Chapter 11 rehabilitation process, said PAL senior vice president and general counsel Carlu Fernandez.

ANA Holdings acquired a 9.75 percent stake in PAL Holdings in 2019, but during the Chapter 11 process, ANA's stake was diluted to 4.75 percent and now to less than one percent.

This was in line with the shareholders agreement submitted by PAL to the US Bankruptcy Court in New York in 2021, which enabled the company's minority shareholders led by ANA to jointly sell their shares.

PAL said this provision was intended 'to protect minority shareholders, to ensure that they benefit from the sale by the majority shareholders of its shares.'

As part of the Chapter 11 process, Lucio Tan, PAL's majority shareholder, increased his stake in PAL to 90 percent from 80 percent after a $255 billion cash infusion.

Tan's Buona Sorte Holdings separately extended a $250 million loan to PAL for a combined $505 million lifeline to PAL.

PAL filed for Chapter 11 in September 2021 and successfully exited the process in December 2021 with a $2 billion reduction in debt, as agreed with its major creditors and a streamlined fleet - anchored on 70 aircraft, from island-hoppers to widebody long-haul aircraft, including NEOs, A350s and B777s.

Moving forward, Ng said the company is on track to full recovery after the Chapter 11 process as it continuously benefits from the recovery of air travel.

He also said the airline is working to achieve its goal to be among the top three full-service airlines in Asia as early as 2025.

Last year, PAL reported an operating income of $297.2 million and a total comprehensive income of $196.9 million, marking its first positive full-year operating income since 2019, as consolidated revenues rose by 112 percent to $2.57 billion in 2022.

This was from an operation loss of $98.1 million in 2021 as air travel was down due to COVID-19 restrictions.

 

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