Manny Pangilinan to buy Philippine Airlines (PAL)?
Manny V. Pangilinan (MVP) is on a buying spree.
Through his holding firm Metro Pacific Investments Corp. (MPI), MVP acquired the following:
- telecommunication company PLDT in 1988;
- water concessionaire Maynilad in 2006;
- the Manila North Tollways in 2008;
- the Philippines’ largest mining company Philex in 2009
- power distribution company Meralco in 2009;
- hospital Makati Medical Center in 2009;
- broadcast network ABC5 (now TV5) also in 2009
Now it appears that MVP wants to add in this portfolio another company that is significant to most Filipinos. Rumor has it that he is already in talks to buy the country’s flag carrier, Philippine Airlines or PAL.
Pangilinan’s planned acquisition of PAL stays true to his strategy of focusing on utilities (water and power) and basic necessities (hospital and transportation) — a strategy that makes a lot of sense since these are inelastic goods and services, meaning consumer demand and consumption remains despite price changes or economic turmoil.
PAL buyout — good to go?
Local newspapers cited an anonymous source “close to Manny Pangilinan” who confirmed that MVP is just waiting for the PAL workers’ row to end before eventually coming in. During the past weeks, the Philippine Airline Employees Association (PALEA) has been rallying against the airline’s plan to outsource several of its operations that would pave the way for the termination of more than 2,600 employees.
According to the same source, MVP is pro-outsourcing and wants PAL to streamline the workers before buying the company — a move different from what he did with PLDT wherein he took responsibility in downsizing the company after acquiring it in 1988.
PLDT denies PAL acquisition plan
Last week, it was reported that PLDT set up a new company called Pacific Global One Aviation Co. Inc. with an authorized capital stock of P430 million. The incorporation was seen as a prelude to buying PAL but PLDT vehemently denied the plan saying the move was simply meant to “rationalize PLDT Group’s internal aviation requirements.”
In a disclosure sent to the Philippine Stock Exchange on September 22, PLDT explained that with Pacific Global One Aviation, incorporators of this new company “will now be able to share in the cost of maintaining and operating” the PLDT Group’s aircraft.
In the same statement, PLDT “denies any intention to acquire PAL.”
Not PLDT, not First Pacific
PAL Holdings Inc., a holding company that owns Philippine Airlines, also issued a statement that it is “not in discussion with First Pacific Co. Ltd,” the Hong Kong-based parent company of MVP’s local holding firm Metro Pacific Investments Corp.
So who’s buying PAL?
It may not be PLDT or First Pacific but it could be a new company that MVP would put up or perhaps PAL would be a new addition under MPI’s portfolio or just be a subsidiary of MVP’s other companies like Philex, Meralco, or Maynilad.
Who knows? Better tune in to TV5 — they might have the (Juicy!) scoop on this one.
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