SEC clears PAL Holdings shares valuation

MANILA, Philippines — The Securities and Exchange Commission (SEC) has approved the valuation of shares of stock to be issued by PAL Holdings Inc. for a share swap transaction in relation to the acquisition of minority interest in subsidiary Philippine Airlines (PAL).

PAL Holdings said in a disclosure to the Philippine Stock Exchange “the corporation’s request to the SEC for confirmation of the valuation of the shares to be issued in connection with the acquisition of minority interest in its subsidiary, PAL has been granted in a certificate dated Dec.18.”

In the certificate, SEC said it approved the valuation of shares of stock amounting to P617.71 million to be applied as payment for additional issuance of 123.54 million shares with a par value of P1 with additional paid-in capital of P494.17 million.

The request for confirmation of valuation of shares was made in connection with PAL Holdings’ share swap transaction with shareholders of PAL.

Under the share swap transaction, PAL Holdings agreed to issue one share for every five PAL shares surrendered to it.

Following the confirmation of the SEC, PAL Holdings will issue 123.54 million shares from its authorized but unissued capital stock in favor of PAL shareholders who have participated in the share swap transaction.

PAL president and chief operating officer Jaime Bautista said earlier, the share swap transaction is expected to provide minority shareholders of the airline a mechanism to benefit from their shares.

PAL shares are currently not being traded, while shares of PAL Holdings could be sold through the local bourse.

Earlier this week, PAL also received SEC approval for its equity restructuring to eliminate the carrier’s deficit.

With the SEC approval, PAL would be using its additional paid-in capital of P13.64 billion to fully wipe off its deficit of P13.57 billion as of Dec. 31 last year.

Earlier, PAL said the move to eliminate the deficit accumulated from losses incurred in the past would allow the carrier to declare dividends and get investors.

PAL which is looking to get a strategic investor, is hopeful it could complete the deal by next year.

The flag carrier expects to benefit from the entry of a strategic investor in terms of the partner’s contribution in equity, management, route development, or possible membership in an alliance.