Philippine Airlines (PAL) plans to raise its capital by up to $500 million (P25 billion) to be sourced mainly from the Lucio Tan Group (LTG), shareholders and banks.
Raising the funds is part of the Chapter 11 restructuring plan that the airline is filing in the United States, according to market sources.
The LTG will provide half of the funds while the remaining $250 million will be sourced through a loan from local banks.
PAL was earlier reported to be talking with aircraft lessors about reducing PAL’s fleet size as part of the conditions for restructuring.
The airline plans to return at least two Airbus A350s and four of the 10 Boeing 777-300s in its fleet.
Some of the A350s are already in the process of being taken back by the lessors, to be leased to other airlines.
PAL Holdings Inc., the airline’s parent company, has reported losses since the first quarter of 2017, including nearly P29 billion in the first nine months of 2020.