Airlines in the Philippines

[Arianespace]

Financing. Yes, that would be the most appropriate answer.

[Evodesire]

^^^ Though how are their finances so far? Are they already beginning to make money?

[Arianespace]

ABS-CBNnews.com

PAL Route To London over Siberia

MANILA, Philippines - Philippine Airlines (PAL) on Friday released two graphics showing the routes of its Manila-London and London-Manila flights.

The first graphic showed the route of the Manila-London flight over Siberia, starting July 25.


The second graphic showed the route of its London-Manila flight, also via Siberia.
border="0" alt="Russian Airspace"/>

Funny how news report can be so wrong.

First and foremost, it has nothing to do with the effects on flight no. MH17.

Second,its been flying much earlier as I posted on this thread.

Third, the most appropriate word should have been Russian Airspace.

fourth, Siberian Airspace refers only to overflight rights from Southeast Asia to North America. It has nothing to do with flights to Europe where much of the flight is via Central Russia. Flights from North Asia to Europe flies over Siberian Airspace.

Therefore, PAL flights to Europe is via Central Russia, which is literally above Kazakhstan, and Korean Air Flights to Europe is Via Siberia, collectively referred to as the Russian Airspace.

[Evodesire]

Looks like PAL's woes aint ending anytime soon. Just read that there is a squabble between the LT group and RSA group. LT wants to buy back the 49% shares of SMC. RSA is willing to sell it but if they will not get it, then SMC will take the remaining 51% of the LT group.

[Arianespace]

You are now finding the reason why they are not yet buying new plane or making new orders. Long haul fleet was supposed to be approved this year but the board deferred its acquisition as there are some issues yet to be settled. What issue that was, its now getting out in the papers. After this is sorted expect announcement from the airline. I am pretty confident SMC will have this airline in the next few months.

By the way, its actually a good thing for the airline.

[Evodesire]

Yes I had been following this. Though I notice how RSA plays this game. He is willing to let go of the 49% but if LT doesn't buy it, he will take the remaining 51%. And it just seems like LT has been wanting to let go of its stake at PAL. Last thing I read is that there should be an announcement soon.

[airboy007]

I am reading everywhere in the news however that the LT group is scrambling to come up with the funds to buy back the 49% from RSA, and this time quite possibly with the help of MVP who was earlier interested with PAL Holdings.

Its just interesting how the change in management (if ever) will once again change the direction of the airline, considering that at this time, it has already posted a small profit and is projected to earn $30million for 2014.

All the best for our flag carrier.

[Arianespace]

See, Told you so!

Ang expects completion of PAL buyout in 3rd qtr

San Miguel Corp. (SMC) is hopeful that their bid to buy out the Tan group in Philippine Airlines Inc. (PAL) would be completed within the third quarter...

And I know exactly how its gonna be after that.

[romantic_guy08]

With PR pulling out the 77Ws from LHR and Canada... four frames are needed for the daily 77W rotation to LAX and SFO... leaving 2 frames as reserve... and I bet we will be seeing another route in the U.S. in the next few months... my money is either JFK or EWR.. two frames I think is enough for a daily rotation to do this.

[chowpau]

asked my dad about what happen to SMC and LT. Sabi nya pera pera lang yan.

He told me that it is Tonyboy Cojuanco who bought PAL before LT. He borrowed money from LT to buy PAL but he couldn't pay his debts so he gave PAL to LT

[Arianespace]

Its actually the gone perks that irked the parties. Well, that is also money.

[Evodesire]

Question is why all of a sudden LT wants to get back PAL when he wanted to let go of it before? Is it just because PAL is now making a net profit?

[Arianespace]

My grapevine source told me that its not actually LT whose interested in buying back the shares. Its the family who runs it now. In fact he wanted it sold. Anyway judging from that remarks, it seems he no longer is in control of the LT group, management wise. Thus, the decision. Apparently, it already saw the silver lining previously only seen by SMC top honcho.

[Arianespace]

airboy007 wrote

I am reading everywhere in the news however that the LT group is scrambling to come up with the funds to buy back the 49% from RSA, and this time quite possibly with the help of MVP who was earlier interested with PAL Holdings.

Its just interesting how the change in management (if ever) will once again change the direction of the airline, considering that at this time, it has already posted a small profit and is projected to earn $30million for 2014.

All the best for our flag carrier.

The deal with MVP is obviously far fetched as it involves the same strategy employed by SMC. Pangilinan will have management control and that is  exactly what went wrong. From that perspective the proposed investment agreement is already doomed to fail. At best LT group will have to raise the funds internally.

Now, the better question would be does the buyback make sense? It surely is a US$1.3 billion answer.

[Evodesire]

I heard from some sources that aside from money, the LT group's direction is totally different from RSA's. The former wants a dual branding thing, Philippine Airlines as a full FSC with features today's FSCs have and PAL Express a full LCC, mono class. But it seems like the latter's strategy of single branding and going hybrid is the one making money.

So I am now wondering how things will transpire. But if you will ask what my hunch is, SMC will win it.

[Arianespace]

No matter what the LT Group wants is immaterial as they doesn't have the management of both airlines. Its with SMC.

That is basically the price you pay for surrendering management prerogative. Your right of business choices is lost and is dependent upon the ones who managed it.

[seven13]

Arianespace wrote

My grapevine source told me that its not actually LT whose interested in buying back the shares. Its the family who runs it now. In fact he wanted it sold. Anyway judging from that remarks, it seems he no longer is in control of the LT group, management wise. Thus, the decision. Apparently, it already saw the silver lining previously only seen by SMC top honcho.

I've heard that it's the children who wants PAL to back in their hands, not El Kapitan himself. Moreover, I once talked to a businessman who is very familiar with PAL and he said that between the 2 (RSA and LT management), RSA wins by far in running the business. He said that RSA knows the numbers (translated to some news that PAL made a profit during the 2Q).

[Arianespace]

Like what I said in the previous post, here's Boo's article today confirming what I know

Shoot out over control of PAL

Anyway, RSA struck a complicated deal on PAL. He realized how much Kapitan enjoyed being called PAL Chairman so he agreed to buy only 49 percent with Kapitan retaining 51 percent and the Chairmanship. But RSA got full management control of PAL. All Tan relatives including daughter, son and brother who held key positions in the airline exited when RSA came on board.

Other relatives, including a Tan son-in-law responsible for other companies that did business with PAL were not too happy. It didn’t help when RSA started to shift the maintenance contract away from Lufthansa Technik that is partly owned by Kapitan. Other services were likewise shifted based on costs and quality of service.

I understand many close associates never ceased whispering to Kapitan how the decision to give management control to RSA was wrong. A persistent story told to Kapitan, according to my sources, is how RSA received commissions from Airbus and Boeing for the re-fleeting program.

Suspected commissions on airplane purchases had always been a sore point in PAL. It will be recalled that similar gossip caused the break-up between Tonyboy Cojuangco and Kapitan shortly after PAL was privatized. Pure gossip led to loss of trust in that early partnership and made Kapitan the accidental airline owner.

When a similar gossip reached RSA, he acted differently from Cojuangco. According to sources close to him, RSA immediately wrote both aircraft manufacturers to send a certified history of commissions they have paid on PAL purchases from way back. The long and short of it is that none were paid to him.

See! I did told you about the plane.

[seven13]

If maintenance will be shifted away from LTP, which company will handle PAL's maintenance?

[Arianespace]

Got a very interesting story yesterday.

But before that, Boo is correct in saying that PAL transferred some business away from LTP because they were too expensive. Some because there are still minor services the maintenance provider performs. While bulk of the maintenance money went overseas. I did recall RSA saying that PAL contract with LTP is bloated that's why he shipped the business elsewhere at a much cheaper cost. That cheaper cost happens to be substantial. That decision did not sit well with the LT Group who happens to own LTP.

To cut the chase, PAL is paying LTP more than what other airline pays for equivalent services. Hmmm  Interesting.

Just like I said, RSA can perfectly do that when Jaime Bautista can't. So that was the first act he did that shocks the LT group. Shocking because it happens to involve millions. Not the pesos of course.

Anyway, that business went to China. And it has something to do with CX.

Moving along, the LT Group formally offered to buy out SMC yesterday. parties talked.

Now here's the rub, the two group seems not to agree on how much price LT group has to pay but nevertheless manages to agree a settlement. So SMC would be eased out of PAL.

But not quite. SMC wants payment expedited, otherwise RSA buy them out in cold cash sooner than they can deliver the money to him.

The Inquirer has a story that some connected with the LT group were already celebrating since Thursday before the formal offer was made yesterday. Perhaps they already have the money, or do they?