PAL Considers Cathay Offer
Nov. 05, 1998
MANILA, Philippines (AP) _ Troubled Philippine Airlines is willing to give Cathay Pacific Airways management rights in exchange for a sizable investment, a PAL official said Thursday.
Manolo Aquino, senior vice president of PAL, said the two companies are discussing an initial buy-in offer presented by Cathay Pacific.
``We met yesterday and we will continue meeting today on what we can agree upon on the first proposal of Cathay Pacific,'' he said in a radio interview. Aquino did not provide details of the proposal.
Cathay Pacific has said it wants management control over PAL.
``Everything is being considered,'' Aquino said. ``Cathay has an open mind and PAL has an open mind on how we can agree to the entry of Cathay Pacific in Philippine Airlines.''
PAL, Asia's oldest airline, has been unable to make payments on $2.1 billion in debt. It was devastated by a pilots' strike in June and by Asia's currency crisis.
PAL shut down its operations on Sept. 23 after a union representing ground personnel turned down a management-proposed recovery plan that included a 10-year suspension of its collective bargaining agreement in exchange for 20 percent ownership of the airline.
Workers agreed to accept the plan nearly two weeks after the shutdown.
The airline resumed domestic flights on Oct. 7 and international flights Oct. 26.