Diversified conglomerate San Miguel Corp. (SMC) is not going to buy out the stake of business magnate Lucio Tan in flag carrier Philippine Airlines Inc. (PAL). This is in contrast to the rumors reported in a newspaper (not The Manila Times) that SMC is already set to acquire Tan’s stake in PAL.
SMC confirmed on Monday that it is not going to acquire 51 percent majority interest of the LT Group, the holding company of Tan’s business empire, in PAL and PAL Holdings Inc. (PHI), respectively.
The conglomerate, however, said that it has been advised by the LT Group that the latter is in talks with a group of investors who have expressed an interest to purchase the majority interest of the LT Group in PAL and PHI.
Since the entry of SMC in PAL a year ago, the new management designed a massive re-fleeting program and expansion for the oldest airline in the country.
Ramon Ang, PAL president, earlier said that PAL will return to profitability in 2014.
LT Group Inc. president Michael Tan, on the other hand, said earlier that PAL will no longer be consolidated into the listed holding firm LT Group, which is focused on being a consumer-related conglomerate.
Some of the LT Group’s subsidiaries are Asia Brewery Inc., Tanduay Distillers Inc., Eton Properties Philippines Inc., Philippine National Bank and tobacco firm PMFTC Inc.
PAL has previously earmarked $1 billion for expansion program, with its current management planning to widen its global footprint to include the Middle East, Europe and Australia.
PAL Holdings Inc., in the nine months of its fiscal year ending March 2012, has reduced its losses by 24 percent to P2.74 billion compared with P3.59 billion as total revenues climbed by 2.4 percent to P55.68 billion from P54.38 billion.
Pal recently announced that it will expand its Australian presence starting June 2013 by adding Darwin, Perth and Brisbane to its roster of flights.
With the expansion, PAL’s connections to Australia will be a total of five including Sydney and Melbourne and a total of 39 in terms of its roster of international destinations.
The airline now deploys 7,400 seats a week on these routes, making it the largest carrier between the Philippines and Australia.