LUCIO TAN GROUP MULLS CAPITAL-RAISING ACTIVITIES FOR PAL, ETON
MANILA, NOVEMBER 25, 2011 (STAR) By Zinnia B. Dela Peña - Tycoon Lucio Tan is considering several capital-raising activities for flag carrier Philippine Airlines (PAL) and real estate deve-lopment firm Eton Properties Philippines Inc.
“We will study,” said Tan when asked whether the group was looking at other fund-raising programs for his other companies.
Tanduay Holdings Inc. (THI), the distillery arm of the Tan Group of Companies, is undertaking a follow-on offering to raise as much as P2.1 billion to fund the expansion of its subsidiaries.
THI president Wilson Young said the Filipino-Chinese billionaire is keenly awaiting the outcome of the liquor firm’s additional share sale to help the group determine whether or not to pursue similar fund-raising activities for the other Tan-owned companies.
“The possibility of PAL and Eton raising funds through the capital market is carefully being studied. The timing would be a major factor given volatile market conditions ,” Young said.
THI and PAL Holdings director Michael Tan said the group remains open to taking in investors in the airline, which is currently besieged by a labor strife, but refused to elaborate.
PAL incurred a net loss of $39.4 million in the second quarter of its fiscal year ending March 2012, 51 percent higher than the $26 million loss recorded in the same period last year due to skyrocketing jet fuel costs. Total revenues rose 4.7 percent to $420.4 million.
Total expenses likewise grew 22.6 percent to $84.8 million to $ 459.7 million. Jet fuel, which continued to account for PAL’s biggest expense, contributed the largest increase of $ 48.3 million, or 33.9 percent higher from $142.5 million in 2010 to $ 190.8 million.
Eton, on the other hand, is required to beef up its public float, currently at 5.6 percent, to the mandated minimum level of 10 percent.
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