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Business

Air21 makes biggest delivery ever: Its 60%

EYES WIDE OPEN - Iris Gonzales - The Philippine Star

 Tycoon Fernando “FZA” Zobel de Ayala must be one busy man these days. I sometimes wonder if he still has time to go on long rides on his big bike.

Ever since FZA officially took the helm of Ayala Corp. as CEO from older brother Jaime Augusto in April this year, the country’s oldest conglomerate has been expanding in different areas of business; all while navigating its way through this debilitating pandemic.

FZA has barely warmed his seat, but in just a few months, Ayala has already broken ground on a planned cancer center, expanded AC Energy, and achieved double unicorn status for Globe’s Mynt, among others.

But wait, there’s more. Last Friday, Ayala announced that its logistics subsidiary, AC Logistics, is acquiring a 60 percent stake in Alberto Lina’s Air21 Group.

That’s a big Wow! Props to FZA for greenlighting the investment despite the still uncertain environment. Kudos as well to AC Logistics president Rene Almendras for making the deal possible. Both Almendras and Lina served in the administration of former president Benigno “Noynoy” Aquino III, as Cabinet Secretary and Customs Commissioner, respectively.

That must have been a plus for the Ayala Group because in the past, other groups had been eyeing a majority stake in Air21, but nothing happened.

The MVP Group had  also expressed interest in Air21, but  later changed its logistics game and decided on just a 12 percent stake. It remains a shareholder in five of the eight companies under the Air21 Group.

Win-win

Having Air21 in its portfolio is certainly a win for the Ayala Group as it would accelerate its logistics expansion, similar to its energy expansion when it acquired a controlling stake in Phinma Energy.

What this means for Ayala is that there’s no need to wait for its existing logistics presence to grow nationwide. Air21 is already present nationwide and its proven system has long been in place.

For Lina, having Ayala’s management prowess certainly adds value to Air21, not to mention the whopping P6 billion windfall that he will get for the 60 percent.

I was actually surprised that Lina, who founded Air21 42 years ago, decided to sell a majority stake in the company.

When I asked him about it, he said he’s still part of the company and that the move is part of transitioning Air21 to the next generation or toward its next great potential.

“I’m still there, but I would like the transition to be secured,” says the 73-year-old businessman and philanthropist, strongly believing that Ayala’s management expertise would add value to Air21 and enable it to grow even bigger.

I am sure Lina’s protégé, former Air21 general manager and president Angelito Alvarez, also a former Customs commissioner, likewise welcomes the deal with Ayala. Alvarez also has a stake in Air21, as I learned from both Alvarez and Lina when I was covering their respective stints at the Bureau of Customs years back.

Alvarez, as the trusted lieutenant of chairman Lina, helped grow the logistics company to greater heights in an increasingly competitive industry, as its longtime president and COO.

I am not sure if there are other investors aside from the Lina family and Alvarez, but for sure, it’s a good day for Air21.

It is likewise a great day for the Ayala Group for receiving Air21’s biggest delivery package to date--the company’s 60 percent.

PAL trims losses

Speaking of good days, it’s a good time for flag carrier Philippine Airlines (PAL) as well after trimming its losses in the nine months ending September.

PAL Holdings narrowed its net loss to P21.61 billion during the period from P28.58 billion incurred a year ago.

It’s still a long way to go for PAL in its journey toward recovery, but this is a positive development.

One headache for PAL in the past was Mabuhay Maritime, the flopped Kalibo-Boracay ferry service.

In 2019, PAL recognized a total impairment loss of P773.70 million from the venture, pertaining to vessels and construction for terminals.

The company ceased operations in 2019, a year after it was launched. It’s good PAL was able to plug the leak from that venture.

Why did PAL push through with it in the first place?

I am not sure who exactly pushed that project, but a former PAL executive told me it was not Lucio Tan’s son-in-law Joseph Chua, contrary to the buzz in the business grapevine.

The former PAL executive, who requested anonymity, said he was present in that board meeting years ago when that ferry project was discussed. The ex-PAL official said Chua, in fact, was among those who raised questions on the feasibility of the project.

“Chua said more time was needed to study if the project was indeed viable,” said the former PAL official, coming to the defense of Chua amid all sorts of speculation on the sudden exit of the taipan’s son-in-law from the Tan business empire.

 

 

Iris Gonzales’ email address is [email protected]. Follow her on Twitter @eyesgonzales. Column archives at eyesgonzales.com

TYCOON FERNANDO

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