The Philippine Securities and Exchange Commission (SEC) has given Philippine Airlines (PAL) the green light for a sale of assets to help clear the carrier's huge debts.
The carrier will sell 442 million pesos' worth ($11.2 million) of assets, with the proceeds used in part to pay Chase Manhattan Asia, which has been hired to restructure the airline's finances and LEK/ Alcar Consulting, which will focus on the airline's corporate restructuring plan.
The SEC has also allowed PAL to pay over $3 million in fees owed to other carriers, and $3.5 million to Hong Kong Aircraft Engineering for planned Boeing 747 work. Press reports say assets being sold include aircraft spares and four unserviceable engines.
PAL is struggling back from the brink of collapse, ridden with over $2.2 billion of debts, and is working to present the SEC with a re-worked rehabilitation plan after the original plan was rejected by creditors. The new plan must be submitted by 15 March.
The carrier is making progress on one aspect of its rehabilitation proposals: the plan to spin non-core business units. Talks are under way with an unnamed European airline on a sale of maintenance and engineering operations.
PAL has previously had talks with Lufthansa maintenance subsidiary Lufthansa Technik on establishing a local joint venture.
Source: Flight International
