Yao to keep Asian Spirit brand in merger with SEAIR

MANILA, Philippines - BUSINESSMAN Alfredo M. Yao will keep the Asian Spirit brand as he merges it, hopefully by next month, with another carrier he is now negotiating to buy — Southeast Asian Air-lines, Inc. (SEAIR). In a telephone interview Wednesday, Mr. Yao said talks with SEAIR owners would soon be finalized. "That (merger) is what we are looking at. Most likely, we are going in that direction. We’re preparing for it now," he told BusinessWorld. Mr. Yao, who also owns juice manufacturer Zest-O Corp., bought Asian Spirit in March and is now negotiating a buyout of Zapanta-led SEAIR. Asian Spirit Chairman Donald G. Dee said the airline’s 2008 expansion plan includes opening new international and domestic routes, and buying at least six new planes. This, he added, should position the carrier to become the surviving entity. "We are very focused on Asian Spirit now. We’re currently doing refleeting, route expansions and increasing operational efficiency," he said in a separate interview. "[The SEAIR acquisition] will not drag long. Before the first half ends, it will be finished one way or another. We are not sure of the outcome, but definitely we do not have any intention to do away with Asian Sprit," he added. Mr. Dee noted that aside the three Airbus A320 planes due for delivery within the year, they have also ordered five smaller propeller aircraft for small domestic airports with high passenger and cargo traffic. At least three of the propellers are expected to arrive this year. "If you look at the increasing passenger volume, it is a neccessity for us to expand and capitalize on it. [With the merger], there will definitely be competition for [budget carriers] now," he added. Sought for comment, SEAIR President and Chief Executive Officer Avelino L. Zapanta said they haven’t heard of developments in ongoing negotiations. "We’re still waiting to be told about the developments. We cannot preempt them because we are not the decision-makers and they [owners] probably think it’s too premature to disclose their plans," Mr. Zapanta said in a separate telephone interview. Analysts earlier said the merger of Asian Spirit and SEAIR should give leading domestic carriers Cebu Pacific and Philippine Airlines serious competition, and should benefit the public through better service and cheaper fares. Asian Spirit is using its 10-aircraft fleet serving nine domestic destinations and three international routes, while SEAIR’s 11 planes fly to 16 local destinations.