PAL and AirPhil executives resign after San Miguel deal

MANILA, Philippines – Some of the top executives of local carrier Philippine Airlines (PAL) and its budget arm AirPhil Express have tendered their courtesy resignations a week after diversifying conglomerate San Miguel Corp and the main shareholders of the airlines entered into an investment deal.

“We agreed that it was just right to do so given the new management that will take over. Almost all from the senior management level submitted courtesy resignations last week,” a board member of PAL told reporters on Tuesday, April 17.

The $500-M deal announced last April 3 grants San Miguel a 49% stake in the holding firms that control PAL and Airphil Express, as well as management control.

In San Miguel’s previous acquisitions, San Miguel usually takes over the top management posts, including finance and human resources, almost immediately after the new owners assume board seats. This was the case when San Miguel acquired direct and indirect stakes in oil giant Petron Corp in 2008.

Under the investment agreements signed by San Miguel with tycoon Lucio C. Tan, the same airline director disclosed that the current PAL president and chief financial officer (CFO) would be replaced by people from San Miguel. On the other hand, the chair and treasurer of PAL would be retained.

Further changes in both management and board levels have yet to be decided on since board meetings in both airlines are still to be scheduled.

“There is no board meeting yet. What is clear is that only the president and CFO positions would have to be vacated,” said another PAL insider.

It was not clear if San Miguel will replace the president and CFO of AirPhilippines Corp. as well.

Tycoon Lucio C. Tan is the chairman and chief executive officer (CEO) of both PAL and PAL Holdings while Jaime Bautista sits as the president for both.

Bautista has reportedly tendered his resignation.

Other PAL officers include Harry Tan, the vice chairman and treasurer, while Henry So Uy is the deputy CEO.

In listed firm PAL Holdings, the CFO is Susan Tcheng-Lee while the corporate secretary is Cecilia Pesayco. – Rappler.com