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MANILA - The Philippine unit of the Southeast Asia's largest low-cost carrier has acquired 49 percent of Zest Airways.
Under the strategic alliance agreement between Air Asia Philippines and Ambassador Alfredo Yao, the Philippine unit of Malaysia's Air Asia will invest in the Zest Air Group by acquiring 49 percent of Zest Airways Inc and 100 percent of Asiawide Airways. Air Asia will also infuse funds into the local airline to augment working capital.
Yao, in turn, will subscribe to Air Asia Philippines' shares.
The agreement will still need regulatory approval.
Marriane Hontiveros, chief executive of Air Asia Philippines, said the strategic alliance between the two airlines shared a common vision of providing passengers with the best value fare possible that enables them to fly to various destinations.
"This proposed investment in the Zest Group will complement the strategies for future growth of PAA, which current operates out of Clark," Hontiveros said.
"This will allow us to leverage on out respective strengths, which in the case of Zest Air, include its operations out of the Ninoy Aquino International Airport, which constitutes majority of air traffic in the Philippines." she added.
Hontiveros also said Zest Air constitutes majority of the air traffic in the county and a strong domestic network which feed into its current international routes.
Owned by former ambassador Alfredo Yao, Zest Air operates in 20 local destinations out of Manila and Clark. The Philippine low-cost carrier flies from Manila to Incheon and Pusan in Korea, Kuala Lumpur, Shanghai, Taipei and Jinjian City in Fujian, China. In addition, the airline has direct flights to Beijing and other Chinese destinations from the Kalibo and Cebu airports.
Zest Air is working for flight entitlements to the United Arab Emirates, Kingdom of Saudi Arabia, Australia, New Zealand and Papua New Guinea.
Air Asia Inc, on the other hand, operates out of Clark to Singapore, Taipei, Thailand, China, Malaysia and Hong Kong. For domestic destinations, the airline flies to Davao and Kalibo. Air Asia Philippines is 40 percent owned by Malaysia's Air Asia through AA International. The remaining 60-percent is held in equal partnership by Maan Hontiveros, businessmen Michael Romero and Antonio Cojuangco.
Earlier, Yao said Zest Air was in talks with Hainan Air and two other Asian carriers for the sale of at least a 40 percent stake in the Philippine carrier.
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