CEB Retakes 1Aviation

 30 October 2024

Low-cost carrier Cebu Pacific (CEB) has taken back majority control of 1Aviation Groundhandling Services Corp. that provides ground handling services to the airline and its subsidiaries operating several airports across the country.

In a disclosure to the Philippine Stock Exchange, Cebu Pacific’s parent Cebu Air Inc. said it has entered into a debt-to-equity conversion with 1Aviation Groundhandling Services Corp. to recapitalize the company to handle the growing demands of the airline.

The swap will wipe out previous advances and loans issued by Cebu Air to 1Aviation, amounting to P113 million, by converting them into equity, as approved by shareholders.

Cebu Air will then raise its ownership stake in 1Aviation to 60 percent once the Securities and Exchange Commission (SEC) approves the conversion. 

Currently, Cebu Air owns 40 percent of 1Aviation, while Jefferson Cheng and the Philippine Airport Ground Support Solutions Inc. (PAGSS) owns 60 percent of the shares.

After recapitalization, Cheng and PAGSS will control the remaining 40 percent in 1Aviation in replacement of the P34.23 million owed to Cheng and P2.78 million borrowed from PAGSS.

 

The airline intends to integrate 1Aviation’s services into Cebu Pacific’s to cut operational costs and enhance service quality on ground handling and logistical support. 

1Aviation, founded in 2018, operates in 34 airports, including the Ninoy Aquino International Airport, through its 6,224 employees.