CEBU AIR, Inc. (CEB), a listed operator for Cebu Pacific’s budget airlines, today reported an investment of $5.61 million to acquire SIA Engineering Co’s 51 % stake. Singapore Airlines Ltd. (SIAEC) is the joint venture of Singapore Airlines Aviation Alliance (Phoilippinas) Corp. (APPC), the servicing, repair and overhaul of aircraft (MRO).
The list airline operator reported that APPC is currently owned 51% by SIAEC and 49% by CEB in a stock exchange statement. CEB acquires 905,641 APPC shares of 6.19 dollars.
The CEB reported that APPC’s net asset valuation is 447.47 million and 51% ownership of SIAEC is equal to $4.50 million in quotations for their quarterly financial statements finishing the month of June.
“The purchase is in line with the overall plan of CEB to match its maintenance lines and strategic goals more closely with CEB network and service needs to significant operating performance and resource management for even more competitive advantage,” she said.
APPC was set up in 2005 to provide the budgetary carrier and other airlines with line servicing, light aircraft tests, operational ram operations and other MRO facilities. The company’s head offices include Manila, Cebu , Davao and Clark.
CEB reported that APPC ‘s ownership would not have a substantial effect per share or net assets by 2020.
CEB has signed an equity sales and buy-in contract with SIAEC to distribute its 35% interest in SiA Engineering Corp. (SIAEP) in a separate divulgation.
It will sell 4,883,424 shares of SIAEP at a price of $1.58 per share, raising CEB cash of $7,74 million.
SIAEP, officially owned 65% by SIAEC, provides aircraft servicing, repair and release controls, 737, A320 and A330, cabin refitting services and maintenance services in Clark, Pampanga, CEB said.
The airline operators noted that the disinvestment is consistent with the policy of “improving the management of the fleet and streamlining the servicing, repair and overholding of aircraft in order to boost operating efficiencies and enhance its core competence.”
As a joint venture company in 2008, SIAEC and CEB set up SIAEP. CEB reported that its SIAEP net carrying value of 35% at 30 June is US$ 7.50 million.