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Philippines' AirAsia in strategic alliance with Zest Airways

11-Mar-2013 2:43 PM

Philippines' AirAsia Inc (PAA) entered (11-Mar-2013) into a strategic agreement with Ambassador Alfredo Yao, who is the majority shareholder of Zest Airways Inc and Asiawide Airways (collectively, the Zest Air Group). In the strategic alliance agreement, PAA intends to invest in the Zest Air Group by acquiring 49% of common stock of Zest Airways and 100% of Asiawide Airways, and, in turn, Mr Yao will subscribe to shares in PAA. The agreement contemplates various regulatory approvals to be obtained prior to completion of the transaction. To further strengthen this partnership, the shareholders of PAA will infuse funds to augment working capital. PAA CEO Marianne Hontiveros said, “Today's strategic alliance between our two local carriers brings pride and joy to Philippines' AirAsia. I am especially delighted to have Amb Yao of ZestAir as a partner as he shares a common vision to provide passengers with the best value fare possible which enables them to fly to various destinations.” She added: “This proposed investment in the Zest Group will complement the strategies for future growth of PAA, which currently operates out of Clark. This will allow us to leverage on our respective strengths, which in the case of Zest Air, include its operations out of the Ninoy Aquino International Airport (“NAIA”), which constitutes a majority of the air traffic in the Philippines, and a strong domestic network which feeds into its current international routes. The stockholders of PAA welcome this partnership with Amb Yao, a seasoned entrepreneur who is well regarded in Philippines". AirAsia said it sees enormous growth potential in the Philippines, especially with a population of over 100 million people across an archipelago of just over 7000 islands, a landscape conducive to air transportation. Ambassador Alfredo Yao commented, “We are truly delighted with this strategic alliance with AirAsia, Inc. It provides a great opportunity to realise both carriers’ common vision to widen the choice of low cost travel within the Philippines and the region. The goal in ZestAir is driven by my passion to capitalise on the tourism potential and, hence, our investment to quickly increase our fleet and expand Zest’s market share." [more - original PR]