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Friday, March 29, 2024

Cebu Air divests $7.74-m stake in SIA unit

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Cebu Air Inc. said Tuesday it divested its entire stake in aircraft maintenance, repair and overhaul provider for $7.74 million to SIA Engineering Company Limited.

The operator of Cebu Pacific said in a disclosure to the stock exchange it signed an agreement with SIAEC to sell its 35-percent shareholdings in SIA Engineering (Philippines) Corp.

SIAEP is 65-percent owned by SIAEC and 35-percent controlled by Cebu Pacific.

“This divestment is in line with CEB’s strategy to streamline its fleet management and rationalize its aircraft base maintenance, repair and overhaul offerings to optimize its operational efficiency and further strengthen its core competencies,” the airline said.

SIAEP, a joint venture between SIAEC and CEB, was established in 2008 in Clark and provides airframe maintenance, repair, de-lease checks, cabin retrofits and overhaul services for 737, A320 and A330 aircraft and maintenance services at Clark.

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Meanwhile, Cebu Pacific signed a share sale and purchase agreement with SIAEC for the acquisition of SIAEC’s entire 51-percent shareholding in Aviation Partnership (Philippines) Corp. for $5.6 million.

APPC is 51-percent owned by SIAEC and 49-percent by CEB.

“The acquisition is in line with CEB’s overall strategy to more closely align its line maintenance operations and strategic objectives with CEB’s network and service requirements, for significant operational efficiencies and optimization of resources for an even stronger competitive advantage,” Cebu Air said.

APPC is a key player in the MRO business, providing line maintenance, light aircraft checks, technical ramp handling and other MRO services to CEB and other carriers.

It is positioned in Manila, Cebu, Davao and Clark and other secondary airports in the Philippines.

“Completion of the acquisition is subject to the satisfaction [or waiver] of conditions precedent which are customary conditions for transactions of this type, including all necessary approvals from relevant government bodies, statutory bodies, authorities, commissions, tribunals, agencies or entities and set out in the SPA,” Cebu Pacific said.

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