SEC approves PAL capital increase
The Securities and Exchange Commission (SEC) has approved the increase in the capital of flag carrier Philippine Airlines as the company prepares for a more aggressive expansion to regain its dominant position in the air travel sector.
The corporate regulator approved PAL Inc.’s capital restructuring, coming in two separate approvals, last Jan. 17, according to the airline’s parent firm, publicly listed PAL Holdings.
The first approval was for the revaluation of PAL’s shares from 80 centavos to 20 centavos, initially bringing down the worth of the company’s total shares to P4 billion from P16 billion.
The second approval was for the increase in the number of PAL’s authorized shares from 20 billion to 100 billion. This gives the firm space to increase its total capital to P20 billion.
PAL’s capital restructuring makes way for additional investments from PAL Holdings, which was approved by shareholders at their annual meeting last June.
At the meeting, PAL Holdings shareholders approved Trustmark Holdings Corp.’s subscription to P17 billion worth of PAL Holdings shares at P1 each. PAL Holdings will use the money to acquire 85 billion shares of PAL at 20 centavos each, bringing the total price to P17 billion.
About 49 percent of Trustmark Holdings is owned by San Miguel Equity Investments Inc., a wholly owned unit of diversifying conglomerate SMC. Trustmark and affiliate Zuma Holdings own PAL Holdings and sister airline AirPhil Express.
PAL is waiting for the delivery of 74 new planes from European firm EADS, maker of the Airbus aircraft. The airline is also negotiating to acquire more planes from United States-based Boeing Co. to bring the company’s total order to 100 new aircraft.
Apart from the expansion of its network in North America with additional flights to the United States and Canada, PAL also wants start services to Italy, Brazil, France, Israel, South Africa, Russia and Japan.
PAL Holdings posted a total comprehensive net loss of P602.92 million at the end of the July-to-September period of 2012, the second quarter of PAL’s current fiscal year that ends this March.
