Philippine Airlines dismisses restructuring claims

Philippine Airlines has dismissed claims that it is seeking court protection from creditors and looking to raise funds. Parent company PAL Holdings refers to a Nikkei Asia report dated 25 November, which cites contents of a PAL townhall meeting and a meeting between the airline and the Philippine government’s Department of Finance held last week. “Please be informed that we sought clarification from Philippine Airlines on the [article quoted] and was informed that there have been no definite decision on the matter,” PAL Holdings states today in a disclosure to the Philippine Stock Exchange. “The instruction from the board is to continue to study the best options for the airline as of this time.” The article claims that PAL is seeking court protection for its debt restructuring and is looking to return 20 of its leased aircraft to relieve a financial burden amounting to at least $1b. Furthermore, it plans to raise $505m through debtor-in-possession financing, for its liquidity needs post-restructuring. $255m will come from PAL’s controlling shareholder Lucio Tan, and $250m from private and government banks.<br/>