PAL to pay some bills

PAL to pay some bills

MANILA (AFP): Regulators on Monday authorized Philippine Airlines (PAL) to pay lessors and creditors US$9.16 million, the Securities and Exchange Commission (SEC).

The flag carrier, which is in receivership, had sought to make the payments by April 15 to avoid aircraft being seized outside the Philippines.

The SEC ruling said its approval was "without prejudice" to the larger case of the debt-laden airline, which is seeking regulatory endorsement of a rehabilitation plan that would reschedule $2.2 billion in debt payments over 12 years.

Those to be paid are 16 lessors or creditors which financed PAL's fleet modernization program. The funds are guaranteed by the U.S. Export-Import Bank and European credit agencies.

PAL's interim receivers had told the SEC "there is a substantial risk that, in the absence of an interim payment, one or more of these lessors/creditors may take legal action to seize aircraft in third country jurisdictions outside the Philippines which may not be stayed by existing Philippine or US court orders."