Cathay Pacific Airways' plan to take control of Philippine Airlines (PAL) faces collapse after talks broke down over critical labour and financing issues, senior Philippine Government officials said.
Ronaldo Zamora, executive secretary to Philippine President Joseph Estrada, said yesterday that PAL chairman Lucio Tan 'is in America now and he is restarting the discussions with Northwest Airlines'.
Northwest was one of the original PAL suitors, sending a team of executives to Manila to conduct preliminary due diligence last month.
It reportedly dropped out of the bidding because it was unwilling to put up cash to help re-capitalise the Philippine carrier.
Swire Group general manager for corporate communications Andrew Herdman denied talks had broken down.
'As far as we're concerned negotiations are continuing, although we are monitoring the situation,' he said.