Asia’s oldest airlines and the Philippines flag carrier Philippine Airlines will be on a potential buy-in deal with one of the Philippines’ largest conglomerates, the San Miguel Corporation.
SMC President Ramon Ang’s group is interested in buying a controlling stake of the company with market capitalisation of 32.63 billion pesos ($744.4 million).
According to the sources familiar with the transactions Lucio Tan is willing to let in new investors to come in for at least $1 Billion US Dollars. The said amount will enable the investor to control the equity and shouldering some re-fleeting costs of the ageing airline.
Different news media organizations in the Philippines reported earlier that the group of Ramon Ang and representatives of the PAL Holdings which is led by Lucio Tan’s brother Harry Tan were in closed discussions before Christmas for the said deal.
Paper works have been drawn already with the presence of tycoon’s brother last Friday. The next step will be the finalization of the deal such as the due diligence audit to finalize the terms and conditions of the deal.
There were some speculations earlier that another group which is interested with the buying of stake from the Philippine Airlines will be lead by Manny Pangilinan, one of the country’s most famous businessman which have already conquered the telecommunication and television industry in the country.
Meanwhile San Miguel on its part were doing some early investments in the tourism sector which is also seen as a move to diversify its business portfolio. San Miguel invested $300 Million to modernize and set up new tourism amenities at the Godofredo P. Ramos airport in Caticlan, the main gateway to Boracay Island.
San Miguel’s acquisition of Asia’s oldest airline will surely boosts the business venture of the Philippine’s largest food and beverage company. PAL executives did not confirmed yet the reported selling of PAL’s stake to another party.