Palace welcomes news on PAL being for sale

MANILA, Philippines - Malacañang welcomed yesterday the announcement of Philippine Airlines (PAL) chairman and chief executive officer Lucio Tan that the flag carrier would be for sale “at the right price,” saying any new investments would mean better services for the riding public.

“Considering that PAL is our national brand, the additional investments would improve the branding of our national carrier. Additional investments would mean improved services,” Presidential Spokesman Edwin Lacierda said in a press briefing.

He said in any negotiations, the government would only want to make sure that the riding public would not be inconvenienced, stressing that would be their “primary concern.”

“As to the specific details of the announcement of Mr. Lucio Tan, we are not privy to that. So that has to be fleshed out,” he said.

“He (Tan) just announced it’s for sale. But are there any takers? There have been rumors that some parties have expressed interests. But they have categorically denied it previously so we don’t know yet. So let’s wait for takers and discussions on those details,” he said.

Tan earlier  confirmed that “some of his friends” have expressed interest in investing in PAL. These include corporate tycoons Ramon Ang of San Miguel Corp. and Philippine Long Distance Telephone Co. (PLDT) chairman Manuel Pangilinan.

He, however, provided no details if there are indeed formal negotiations with specific parties as well as confirm top-level talks with potential investors and his reasons for selling.

PAL employees earlier said they have not been updated on the status of top-level talks with potential investors such as Ang and Pangilinan.

San Miguel, for its part, had disclosed that the planned venture would finance the company’s refleeting program.

The management of the country’s flag carrier, for its part, said it welcomes the possible entry of a new investor.

A refleeting would enable PAL to upgrade its aging planes by 2015.

According to latest data, PAL reported a loss of $39.4 million for the second quarter of its fiscal year, or from July to September 2011, due to high fuel costs.

PAL had expected the average fuel cost to hit $120 per barrel but this has risen to $135 per barrel.

For its current fiscal year, PAL expects to post losses because of high fuel costs and revenue losses brought about by the strike of its employees.

Last September, PAL employees went on strike in protest of the company’s outsourcing plans. The strike resulted in crippled operations for PAL and thousands of passengers stranded.