Tapian Lucio Tan resurfaced from COVID on Saturday to reassure Filipinos that he was determined to see Philippine Airlines through its bankruptcy.
Tan’s grandson, Lucio Tan III, read his grandfather’s statement after PAL revealed that it had filed for Chapter 11 bankruptcy in the United States, along with a filing in the Philippines.
“We will complete the recovery of Philippine Airlines. We will firmly support the management and employees of PAL as they undergo the restructuring process,”Tan III read from his grandfather’s statement.
Last April, the older Tan was diagnosed with COVID-19 and treated in an unnamed hospital. He did not speak in the PAL video greeting and instead deferred to his grandson, who is on the airline’s board of directors.
“In times of national crisis, we are here to serve the Filipino people. Today, I give you this assurance, like the Philippine flag, we will continue to stand tall and strong,”Tan III added.
Lucio Tan III is the son of Lucio “Bong” Tan Jr., who died in an accident on a basketball court in 2019.
“Philippine Airlines will keep flying, now and into the future,”he said.
The firm intends to lower its borrowings by $2 billion through a proposed restructuring plan, which requires court permission and will let the carrier to reduce its fleet capacity by 25%, according to the company.
Philippine Airlines will also receive $505 million in equity and debt financing from its primary shareholder, along with $150 million in loan financing from new investors.
A firm can continue to operate under Chapter 11 while it is restructured. The filing on Friday comes after months of negotiations with the airline’s stakeholders. The filing, according to billionaire owner Lucio Tan, is a “huge breakthrough” for the carrier.
The reorganization plan enables the airline to “overcome the extraordinary impact of the global pandemic, which has profoundly affected businesses in all sectors, including aviation, and emerge stronger for the long term,” said Mr. Tan, chairman and CEO, in a statement.
While the end of lockdowns eased the strain on travel at the start of the Northern Hemisphere’s summer season, the delta variation of COVID-19 has just began to harm numerous airlines, particularly in the United States and China.