MANILA, Philippines – San Miguel Corp. (SMC) on Monday confirmed that it is in talks with the Lucio Tan group in relation to ownership of flag carrier Philippine Airlines (PAL).
“We advise that the [SMC] and the Dr. Lucio Tan Group are in discussions with respect to their equity stakes in PAL Holdings, Inc, Philippine Airlines, Inc. and Air Philippines Corporation, respectively,” SMC said in a disclosure to the Philippine Stock Exchange.
San Miguel currently owns 49 percent of PAL while the Tan family owns the remaining 51 percent.
An Inquirer report citing industry sources said SMC president Ramon Ang had agreed to sell SMC’s interest in PAL back to Tan’s group in 2013.
However, SMC is also open to buying Tan’s stake should they fail to raise the amount needed to buy back shares.
“An appropriate disclosure shall be made in the event a definite agreement is concluded by the parties,” SMC added in the disclosure.
The Inquirer report also said that Tan’s group will need an estimated $1 billion to buy back shares of PAL from SMC.
SMC bought a 49 percent stake in PAL in 2012 and had since been replacing the airline's ageing fleet with new jets.