MVP mum on PAL buy-in talks

By: Paolo G. Montecillo

Philippine Daily Inquirer

1:37 am | Monday, January 30th, 2012

MANILA, Philippines—Business executive Manuel V. Pangilinan remains mum on talks that he and a rival group are in to acquire the nation’s flag carrier, Philippine Airlines (PAL).

In a recent chance interview, the Philippine Long Distance Telephone Co. (PLDT) chairman neither confirmed nor denied that he was in discussions with any group for a majority stake in the airline.

“I’ve said all I need to say on the matter,” Pangilinan told reporters.

Aside from Pangilinan, the only other group said to be eyeing PAL was diversified conglomerate San MiguelCorp.

Earlier this month, PAL chairman Lucio Tan, one of the country’s wealthiest individuals, said he was willing to sell his majority stake in the company “for the right price.”

Tan was also quoted to have said that both Pangilinan and SMC president Ramon S. Ang were his “friends.”

The company’s management, however, later clarified that Tan was merely making a rhetorical remark on the possibility of letting go the financially troubled carrier.

In a previous disclosure to the Philippine Stock Exchange (PSE), San Miguel confirmed that it had been invited to participate in the “refleeting” of PAL’s fleet of planes, although officials were mum on whether this would involve the infusion of fresh equity resulting in a change in control.

If Pangilinan were to secure a controlling stake in PAL, industry watchers say this may prove to be a difficult situation for the group since the Gokongwei family that owns the airline’s chief rival, Cebu Pacific, also owns a substantial stake in PLDT.

PAL, which used to monopolize in the country’s air travel, has struggled to keep up with changing industry dynamics that were a result of the industry’s liberalization instituted by the Ramos administration in the 1990s.

Because of its “full service” business model, PAL has been unable to match the low ticket prices offered by budget carriers like Cebu Pacific.

Due to soaring fuel prices, PAL reported a $39-million net loss at the end of September 2011, the end of the first half of the airline’s April to March fiscal year. This was a reversal from the $26.7-million profit the airline booked a year earlier.

Source: http://business.inquirer.net/42033/mvp-mum-on-pal-buy-in-talks

Prosecution: Corona got perks from PAL; Defense: why subpoena media?

29-Jan-12, 10:04 AM | Lira Dalangin-Fernandez and Karl John C. Reyes, InterAksyon.com

The prosecution said Corona received special privileges from the management of the Philippine Airlines while cases against the country’s flag carrier were pending before the high court.MANILA, Philippines - (UPDATE: 5:33 PM) The prosecution and defense in the impeachment trial of Chief Justice Renato Corona traded accusations at the weekend, with the prosecution alleging he got privileges from PAL while the airline's case was pending, and the defense decrying the desperation of the prosecution in its bid to subpoena journalists and SC justices.

Iloilo Rep. Niel Tupas Jr., the head of the panel, said the prosecution is now looking at the travel records of Corona and his wife, and will present evidence and witnesses before the court.

Article III of the eight charges accuses Corona of culpable violation of the Constitution and betrayal of public trust for his “failure to meet and observe the stringent standards of the Constitution that a member of the judiciary must be a person of proven competence, integrity, probity, and independence in allowing the Supreme Court to act on mere letters filed by a counsel which caused the issuance of flip-flopping decisions in final and executory cases,” among others.

Prosecutors have cited a Supreme Court resolution recalling its final decision on the illegal retrenchment case filed by the Flight Attendants and Stewards Association of the Philippines (FASAP) against PAL by acting on a mere letter from the carrier’s lawyer Estelito Mendoza.

In connection with this case, five witnesses will be presented, including representatives from the Bureau of Immigration (BI), PAL, Supreme Court, Prestige Travel Agency, and Securities and Exchange Commission (SEC).

The BI representative will produce and testify on the travel records of Corona and wife, Cristina, “to show that he accepted special privileges from PAL management while PAL cases are pending before the Supreme Court,” according to the prosecutors in a statement.

The PAL representative, they said, will testify on the travel dates of the Corona couple via PAL and the corresponding seats occupied.

They will also call to the witness stand an employee of the Supreme Court who handles the official travels of the magistrates to testify on the chief justice’s trips via PAL and the type of airline tickets he purchased.

Prosecutors noted that the Supreme Court often tapped the services of Prestige Travel Agency, which according to SEC records, is owned by the family of lawyer Estelito Mendoza. 

Defense: why summon journalists, SC justices?

This developed as the defense panel of Chief Justice Renato Corona decried the prosecution plan to summon media workers as witnesses, saying that while the accused has lived with the “unfavorable” media coverage, summoning journalists to testify in the impeachment trial is another matter.

Defense lawyers also assailed the prosecution bid to have associate justices of the Supreme Court testify against Corona.

“Media has not always been for us but we are fine with that and we learn as we go along on how best we can bring our messages to the people so they can understand the Chief Justice,” Defense Spokesman Atty. Rico Quicho said in reaction to the prosecution’s request for the impeachment court to subpoena  100 witnesses.   

The “media has a role to play in a democracy, no matter how the Defense feels about it and even if the Defense has been on the short end of it in getting favorable coverage.” But, he added, “we take exception to the proposed plan of the Prosecution [to make journalists testify].” 

Media has three basic roles: to inform, educate and entertain and “even if some have gone further, they have a unique role,” said Defense panel spokesperson Atty. Karen Jimeno. 

The “Prosecution has pierced the veil of confidentiality with the ITR, let us not drag the media and place it on the witness stand. The Media is not on trial here. Prove your case by doing your work in research and litigation,” Jimeno stressed. 

The Defense also cautioned against the plan to subpoena Justices of the Supreme Court. 

“Is the Prosecution saying they need the other Justices to rat against the Chief Justice and against each other on how they voted on a particular case?” asked Quicho. 

Jimeno explained that such plan would again pierce the veil of the time-honored confidentiality of the Court in the disposition of cases.  

The best proof is still the decision itself and that it why there are dissenting and concurring portions of any decision, she added.

Source:http://www.interaksyon.com/article/23111/prosecution-corona-got-perks-from-pal-defense-why-subpoena-media

PALEA testifies vs Philippine gov’t

Posted on January 25, 2012 11:31:52 PM

THE PHILIPPINE Airlines Employees Association (PALEA) testified against the national government at a hearing in Washington in a labor issue which could jeopardize the preferential tariff rates enjoyed by Filipino exporters through a US trade development scheme.

The testimony came as the United States Trade Representative (USTR) office performed on Tuesday a routine review of the Philippines’ status as a beneficiary of the US Generalized System of Preferences (GSP), the labor group said in a statement yesterday.

Manila, for its part, sent a high-level delegation to Washington DC to respond to the labor rights case which was first filed against the Philippines in 2007.

“PALEA presents a significant case in reviewing whether or not the Philippines has taken or is taking steps to afford workers their internationally recognized rights. We submit that the Philippine government has abused its power to assume jurisdiction of strikes thereby curtailing workers’ rights to freely organize and bargain collectively,” PALEA president Gerry Rivera said at the overseas hearing, as quoted in the labor group’s statement yesterday.

“PALEA was not allowed to strike on two crucial occasions to protest the mass termination of some 2,600 workers and yet Philippine Airlines (PAL) was permitted to proceed with the layoff despite a pending case at the Court of Appeals,” he continued.

The GSP, which US President Barack Obama renewed in November, grants eligible developing and least developed economies affordable access to the American market in a bid to stimulate domestic productivity among America’s partner countries.

Over 4,800 products from 129 beneficiary countries can enter the US duty-free through the preferential scheme.

The trade assistance, however, requires such countries to take effective steps toward upgrading and implementing its labor standards. Otherwise, developing economies stand to lose preferential treatment for their products, as in the case of Belarus which was suspended in 2000 for failing to protect workers’ rights to association and collective bargaining. -- Eliza J. Diaz

http://www.bworldonline.com/content.php?section=Economy&title=PALEA-testifies-vs-Philippine-gov’t&id=45658#.TyBIx49CWtR.facebook

San Miguel Buys into PAL

To infuse US $1 Billion for Fleet Expansion  

 January 24, 2012

Food and beverage giant San Miguel Corporation has agreed to buy shares of PAL Holdings and finance the refleeting and modernization program of Philippine Airlines. PAL Holdings directly owns 81.57% of Philippine Airlines.

The deal includes budget carrier Airphil Express, its low cost subsidiary.

San Miguel offered $500 million in cash and another $500 million in equity infusion in exchange for a 49-percent stake in both PAL and Airphil, but secures management control of the two airlines.

A disclosure to the Philippine Stock Exchange said San Miguel Corporation would increase the capitalization of PAL and its low cost subsidiary to buy new aircraft.

PAL Holdings Chief Finance Officer Susan Lee confirmed to the stock exchange investments by San Miguel in PAL Holdings.  

The plan calls for the purchase of 12 medium sized long-ranged planes either from Airbus or Boeing, with Airline engineers taking a closer look and evaluation at the Airbus 350-900 planes which order is scheduled to be announced before the end of the year. First aircraft delivery is scheduled to take place in March 2016.

"Wide-bodied aircraft are needed. You need to pay delivery fees. That’s where the cash is needed,” Airline President Jaime Bautista said.

San Miguel is currently holding due diligence audit with the airline which is expected to be finish next week. Joint announcement is expected on the next General Assembly Meeting in April.

As a result of San Miguel investment, Lucio Tan would remain chairman of PAL with San Miguel President Ramon Ang, as its Chief Executive Officer. PAL president Jaime Bautista will remain Chief Operating Officer.

PAL Holdings operates a fleet of 51 aircraft and 22 on orders as of March 2011.

http://philippineairspace.blogspot.com/2012/01/san-miguel-buys-into-pal.html?spref=fb