Buy PAL for $800M, with AirPhil thrown in!
TAIPAN Lucio Tan is selling Philippine Airlines for something like $800 million — with his smaller airline, Air Philippines, thrown in.
This unusual “buy one-take one” offer is different from his other bargain sale offer, that of the Philippine National Bank where he holds the controlling shares.
And with PAL finally chalking up a P44-million annual profit (albeit unaudited) as it completed the first quarter of the new millennium, the airline is starting to look attractive to prospective buyers. It is its first time to hit the black in seven years.
Lufthansa of Germany is set to buy into PAL, but is interested at the moment only in the catering and maintenance outfits, not the airline proper. The union is protesting the sale of these service units since it would chop its membership and income.
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JUST 12 months ago, PAL was on the brink of bankruptcy, a victim of the regional financial contagion, restive unions and a squeeze play of its competitors.
But the airline overshot the targets set under its government-monitored rehabilitation plan as well as its own internal budget estimates. Under tight management, PAL was able to generate more revenue, cut expenses and post productivity gains beyond targets.
The last time PAL posted a positive financial report was in 1992-93, when it booked a profit of P1.025 billion. Then followed six straight years of net losses during which the airline lost a total of P25.614 billion. In fiscal 1998-99 alone, PAL lost a staggering P10.181 billion.
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“AS corporate profits go, P44 million is really nothing to crow about,” said Tan, chairman and chief executive officer. “But considering where we came from, it is a signal achievement. The credit goes to the men and women of PAL, whose hard work and dedication to duty were the major factors that turned this company around.”
Tan also cited the “support of PAL’s creditors, lessors and suppliers, along with the patronage of the over five million passengers who flew with us last year.”
Tan’s sentiments were shared by president and chief operating officer Avelino L. Zapanta: “That we were able to resuscitate PAL, with the magnitude of its problems, in just one year is a feat unprecedented in Philippine business.”
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MEANWHILE, we add our small voice to the point of our publisher and chairman Max Soliven that it is the Muslim secessionists who are warring against the republic and not the other way around, and that the brutality and treachery with which they fight government demand swift, firm action and not appeasement.
We cannot accept a situation where a different flag flies over a portion of our nation, where a rebel force holds territory and maintains military camps, collects road toll and taxes, presumes to send envoys to sympathetic states, and bring up children in the warlike tradition of blindly fighting the government and sowing terror.
It is sad that when these terrorists inflict beastly torture on their innocent victims (e.g. eye-gouging, pulling out of nails, raping and slashing women’s breasts, etc.), not a word is heard from supposed human rights advocates who are ever quick to denounce the least indication of errant behavior among soldiers.
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OUR comments do not add to the soundness and impact of Manong Max’s arguments, but we speak up nonetheless to show solidarity with him and the majority of our people who have said that enough is enough.
We don’t have direct personal knowledge of the situation in specific battlefields in Mindanao, but we reiterate our stand that if the tactical situation warrants attacking terrorist camps, the military should move immediately against them.
At the same time, however, we hasten to warn that nobody in government should use war as a ploy for rallying public support for a corrupt regime.
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WE sense either a major decision or a policy shift in the air. But since we’re not privy to state secrets, we can only speculate.
The rebels are obviously beginning to feel the pressure of relentless military pursuit. This is evident in their uncharacteristic sudden willingness to sit down and talk, even if they are only stalling for time.
Tactically, this is the best time to hit them and bring them to their knees, if not wipe them out. But strangely, the military is holding back. Why?
Still speculating, we surmise that both internal and external reasons are behind this unusual lagging in the military drive to search for and destroy the enemy.
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THE external factors can include the growing impatience among countries, particularly European, with nationals among the 21 hostages being held by the terrorists in some thickly forested islands in the South.
The German ambassador has just expressed his government’s disappointment with the desultory, slow-motion efforts to spring the hostages. One of the hostages is an ailing German woman.
For a different reason, the Malaysian ambassador is also publicly expressing displeasure over the entire moro-moro. There are nine Malaysians among the hostages seized by the terrorists in a Malaysian resort and taken to Sulu more than a month ago.
At a formal Malacañang function the other day, the Papal Nuncio, dean of the diplomatic corps, expressed concern over the fighting in Mindanao and the Vatican’s hope for peace in the region. Similar sentiments have been communicated by other governments.
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SOME of the governments concerned have been reported as willing to cut short the impasse by paying off the kidnappers. They reportedly see ransom as a better alternative to a clumsy attempt at a rescue by Erap troopers.
It may not seem probable, but there is also the possibility that some impatient foreign power might just execute a swift commando rescue. We won’t be surprised if such an operation is being prepared in some foreign capital.
The kidnapping of tourists of various nationalities and their being transported across national borders are enough legal justification for such intervention, especially with the continued failure of the Philippine government to get the hostages out.
That would make us the laughing stock of the world, a global Erap joke of sorts.
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A MILITARY rescue attempt was hinted at by chief government negotiator Secretary Robert Aventajado if, he said, the talks break down.
Even without Aventajado saying it, everybody presumed all along that a military option is in the cards. For saying the obvious, he is now under fire. Why? Our guess is that that last card has been brought up, ready to be played.
This possibility reared its head as the government suddenly said “teka muna” (wait a minute) and called for a top-level caucus to analyze what is vaguely referred to as an upcoming significant development in the hostage drama.
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AFTER the last time they talked, the Abu Sayyaf demanded that Aventajado be replaced. Why? It cannot be that they wanted Aventajado dropped just because he confirmed that there was this military option.
The only reason we can see is that until their last meeting, he had refused to gratify the salivating kidnappers and hand over the money, something like $1 million for each of the 10 Caucasian hostages
After all, this is what the kidnapping is all about — big bucks. (As for the two Filipinos and nine Malaysians, the general impression is “bahala na sila sa buhay nila.” [Let them fend for themselves])
In the Palace, meantime, there was a comic relief over Executive Secretary Ronaldo Zamora’s turning pale when the Abu Sayyaf suggested that he be sent in place of Aventajado.
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THE sudden timeout call by Malacañang ostensibly to reassess the situation may have been partly prompted also by some internal factors.
One factor is the government’s running low on funds. That’s bad news. What else will the bigtime crooks in government steal if the money is funneled to the “Giyera ni Erap” blockbuster raging in Mindanao?
It would be embarrassing for our macho President to pull back the troops because he is running out of bullets. That’s why the reported request of Church leaders for an urgent meeting (scheduled yesterday) with the President came in the nick of time.
It would be interesting to know on whose initiative or suggestion the meeting was set. Did somebody identified with the Palace suggest to the Church that the meeting, set next week, should be advanced?
Whatever it was, we hope President Estrada levels with the prelates, instead of using the Church to rationalize a policy shift or an upcoming big decision.