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Lucio Tan buys back PAL
Lucio Tan of the LT Group, Inc. (LTG) signed a $1.0 billion deal to buy back the 49.0% stake in Philippine Airlines (PAL) from San Miguel Corp. (SMC), ending a 2-year-old alliance and regaining management control of the now-profitable flag carrier.
The estimated amount of the deal covers not only the payment for SMC’s stake but also the cash advances made by the conglomerate for the flag carrier’s re-fleeting program.
Lucio Tan borrowed $850 million from a syndicate of banks, including the SM group’s BDO and China Banking Corp. as well as Philippine National Bank and Asia United Bank. The rest will be covered by the tycoon’s existing cash flow.
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