Cebu Pacific in talks to acquire AirSWIFT

MANILA, Philippines — The Gokongweis and the Zobels are in talks for yet another major deal, this time for Cebu Pacific’s acquisition of boutique airline AirSWIFT from the Ayala Group’s property arm Ayala Land Inc. (ALI), industry sources told The STAR.

The budget carrier’s acquisition of AirSWIFT, which may be sealed in two months barring any headwinds, is seen boosting domestic tourism especially in the coastal town of El Nido in Palawan, which is famous for its white sand beaches, emerald waters and limestone cliffs.

“The deal may be closed in two months or earlier,” an industry source said, adding that it is a win-win for both the Gokongwei and Ayala conglomerates.

The deal, which would see Cebu Pacific take over the airline’s ownership, would be a game changer for the Gokongwei-led low-cost carrier as it would enable it to capture the El Nido market, complementing its other Palawan destinations such as Coron and San Vicente.

It would also provide Cebu Pacific with tailwinds to soar to even greater heights especially with its historic P1.4-trillion purchase of as many as 152 aircraft from aviation giant Airbus, touted as the largest plane order in Philippine history.

For the Ayala Group, it would mean unlocking the value of the boutique airline which it has been able to expand through the years from just a small charter carrier in 2002, another source said.

AirSWIFT Transport Inc., founded in 2002 as Island Transvoyager Inc., has a fleet of five ATR or regional transport airplanes - two ATR 42-600 and three ATR 72-600. Its destinations include El Nido, Cebu, Boracay and Bohol, according to its website.

The boutique airline was founded originally to charter guests flying to the world famous El Nido Resorts in Northern Palawan namely Miniloc, Lagen and Pagulasian, which at one point were owned by the Andres Soriano Group.

In 2012, the Ayala Group acquired AirSWIFT after ALI bought a 60 percent stake in the exclusive El Nido Resorts in 2010 from Asian Conservation Co. (ACC). In 2013, ALI, through subsidiary ALI Capital Corp. took full control of the resorts by acquiring ACC’s remaining 40 percent stake.

As the population of El Nido grew through the years – 50,000 as of 2020 from 41,000 in 2015 – so did AirSWIFT’s passenger market. As such, the boutique airline started expanding, flying non-El Nido Resort passengers to other parts of the coastal municipality.

Thus, as the airline grew bigger, the Ayalas deemed it was a good time to exit the company especially because running an airline business is not among the group’s core competencies, sources said.

Japhet Tantiangco, research manager at Philstocks Financials, commenting on Cebu Pacific’s prospects, said: “The airline’s capacity expansion is seen as a good move as it will allow the company to take advantage of the local and global tourism which is recovering from the pandemic and is expected to boom further moving forward.”

Officials from both ALI and Cebu Pacific declined to comment on the potential acquisition.

If the deal pushes through, it would be the Gokongwei and the Ayala groups’ second major deal in less than two years following the merger of their respective banks.

Last year, Ayala-led Bank of the Philippine Islands and Gokongwei-run Robinsons Bank agreed to consolidate, with BPI as the surviving bank.

The consolidation was meant to unlock various synergies across several products and service platforms, expand the customer and deposit base of both banks through the merged entity, and, at the same time enhance the overall banking experience of Robinsons Bank customers.