MANILA, Philippines—Taipan Lucio Tan’s Philippine Airlines (PAL) announced its commitment to continue operations—including transporting vaccines and stranded Filipinos—amid a looming restructuring plan meant to ensure its survival during the global health catastrophe.
“Our flights and operations will not be affected in any restructuring,” PAL said in a statement on Tuesday (May 11).
“We continue to increase our international and domestic flights as the market recovers with easing of travel restrictions,” the flag carrier added.
PAL, which counts Japan’s ANA Holdings as a minority shareholder, has yet to disclose details on its restructuring plan.
But sources had previously said this will include a Chapter 11 creditor protection filing in the United States. PAL is seeking creditor support as it moves to restructure as much as $5 billion in obligations, the Inquirer previously reported.
“Philippine Airlines management and stakeholders continue to work on a comprehensive restructuring plan that will enable PAL to emerge financially stronger from the current global crisis,” PAL said in its statement.
“As the work is ongoing, we will make the necessary disclosures at the proper time, once details are finalized,” it added.
PAL’s current restructuring plan would be wider in scope than its rehabilitation program executed in the wake of the 1997 Asian Financial Crisis.
It emerged a stronger business and continued to expand its fleet and routes, eventually achieving a coveted four-star rating from Skytrax in 2018.
Alongside other airlines, PAL suffered massive losses during the COVID-19 pandemic as passenger demand collapsed.
It took steps to control costs, including layoffs and management pay cuts, the suspension of capital spending and the deferral of lease payments for aircraft.
TSB