MANILA, Philippines — The Philippine unit of Southeast Asia’s biggest budget carrier AirAsia Berhad has pushed back its $200-million initial public offering (IPO) to first quarter of 2018 from 2016, as it finalizes the streamlining of its operations and re-fleeting of aircraft.
"The IPO will definitely happen, [but it will be] in the first quarter of 2018 because the 2015 re-fleeting caused a setback. At the current stage, I’m not offering it if I’m not confident [as] it might be undervalued," Philippines AirAsia, Incorporated (previously AirAsia, Incorporated) CEO Joy Caneba told local journalists over lunch on Tuesday, October 27.
AirAsia Berhad used to operate in the Philippines through Filipino company AirAsia Philippines (Air Asia, Incorporated), which has a 49% stake in AirAsia Zest (Zest Airways, Incorporated).
But just recently, the Civil Aeronautics Board approved its petition to operate as a single company with just a single certificate. The company is called Philippines AirAsia, Incorporated.
The Securities and Exchange Commission issued a certificate approving the name Philippines AirAsia, with "doing business under the name and style of the AirAsia Berhad."
"This will put us in a better position as it will mean lower operational costs as everything will be streamlined," Caneba added.
It was in February this year when AirAsia Philippines secured approval from the Securities and Exchange Commission (SEC) to acquire the remaining 51% stake in AirAsia Zest currently held by former ambassador Alfredo M. Yao. This deal will allow AirAsia Philippines to own the entire carrier.
More planes
According to Caneba, the shareholders of Philippines AirAsia are investing more money into the airline for next year, increasing the airline's capital stock to P5 billion ($106.84 million) to fund the lease of 5 more aircraft for 2016.
"The capital call is within the existing shareholders only. But we welcome new investors," Caneba said.
Philippines AirAsia currently has a capital of P2 billion ($42.75 million).
But the budget airline chief said that stockholders have approved a capital infusion of up to P3 billion ($64.13 million) for 2016, which will be mainly used for route and fleet expansion.
"China and the Philippines are a natural route combination, and the yield for that market is doing good. Our market in China is doing very, very well, too. We also plan to open Taipei on top of our Macau and Hong Kong flights," Caneba said, when asked where the 5 planes will be used.
Philippines AirAsia has retired 3 of its planes, to align the image of the local affiliate with its Malaysian parent AirAsia Berhad.
As of now, the local budget airline operates with 12 A320s.
Philippines AirAsia flies to Hong Kong, Kuala Lumpur, Seoul, Kota Kinabalu, Macau, Busan, Shanghai, Beijing, and Hangzhou.
It also services Cebu, Davao, Kalibo, Puerto Princesa, Tacloban, and Bohol. – Rappler.com
$1= P46.80