Romero ups stake in AirAsia PHL operator ahead of planned IPO

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F&S Holdings Inc., a company owned by Michael L. Romero (third from left) and Sheila B. Romero (fourth from right), announced it is now the majority shareholder of Air Asia Inc. (AAI) — owner and operator of Philippines AirAsia Inc. In photo from left to right are: Ruby Villavicencio Paurom, of the Romero Group communications team; Agnes Maranan, AAI director; Bo Lingam, AirAsia deputy group CEO; Dexter M. Comendador, president and CEO of Philippines AirAsia Inc.; Marianne B. Hontiveros, chairperson of Philippines AirAsia; and Joseph Omar Castillo, AAI director.

By Denise A. Valdez, Reporter

THE Romero-led F&S Holdings, Inc. increased its stake in the operator of Philippines AirAsia, Inc. to become the single largest shareholder in the low-cost carrier ahead of its planned initial public offering (IPO) later this year.

F&S Holdings, owned by businessman Michael L. Romero and his wife Sheila B. Romero, acquired the shares held by Philippines AirAsia Chairman Marianne B. Hontiveros and Zest-O Corp. Founder Alfredo M. Yao in the airline company, bringing its stake to 44.4% from 15.7% previously.

The announcement was made by Sheila B. Romero, chairman of F&S Holdings, during a media briefing in Makati City on Monday.

“We are now taking on the role as the majority shareholder of AirAsia, Inc. (AAI), the corporation that owns and manages Philippines AirAsia. Owned by (1-Pacman Party-List Rep.) congressman Mikee Romero and I, F&S Holdings recently acquired (28.7%) shares of AirAsia, Inc., raising its total shares to (44.4%),” Ms. Romero said.


Based on records from the Philippines AirAsia website, Ms. Hontiveros and Mr. Yao each had a 15.7% stake in the company, while Malaysia AirAsia International Ltd. holds the remaining 39.9%.

The value of the deal was not disclosed, as Mr. Romero said the board is still finalizing the figure. He also noted the restructuring is not expected to change the composition of Philippines AirAsia’s current board of directors.

The development comes ahead of the planned recapitalization of the company to prepare for IPO by around November or December.

“Based on our EBITDA (earnings before interest, tax, depreciation and amortization) right now, we plan to put a valuation of about $600 million for the company,” Mr. Romero said.

“We get $600-million (valuation), so we’re planning to raise about $200 million. That’s just initial, kasi [because] our partners want to list the company within the year,” he added.

The recapitalization will be a mix of common shares of about P900 million ($17 million) and preferred shares of P17 billion. Mr. Romero noted all existing shareholders of Philippines AirAsia will subscribe to the recapitalization.

It tapped Citigroup, Inc. as financial advisor for the IPO, and is looking at BDO Capital & Investment Corp. as another potential advisor.

The $200 million that the company aims to raise from the IPO will be used mostly for aircraft acquisitions and additional working capital.

Philippines AirAsia currently has a fleet of 23 aircraft. Mr. Romero said the plan is to raise it to about 30 planes within the next two years.

In the first quarter, Philippines AirAsia booked a profit of P424.5 million, a 12% growth from the same period last year, due to a 27% increase in revenues at P6.68 billion.

Mr. Romero said the company expects to end the year at a profit after recording a loss of P2.11 billion in 2018.

“The company is now turning around and becoming very profitable… We plan to make our revenue from P30 billion this year to about P50 billion in three years’ time,” he said.