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SIAEC in non-binding pact with Cebu Air to expand MRO services in the Philippines

SIA Engineering Company Limited (SIAEC) and Cebu Air Inc have entered into a non-binding letter of intent to further collaborate to expand maintenance, repair and overhaul (MRO) services in the Philippines.

The growth opportunities have an estimated investment value of US$15-20 million, SIAEC said on Sunday.

Currently, they have two existing joint ventures in the Philippines - Aviation Partnership (Philippines) Corporation (APPC) and SIA Engineering (Philippines) Corporation (SIAEP).

APPC provides line maintenance services in four major international airports, namely, Manila, Cebu, Davao and Clark, as well as other secondary airports in the Philippines; SIAEP, which is located in Clark in the Philippines, has three hangars and provides heavy maintenance aircraft checks, including backshop support and line maintenance services.

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Under the letter of intent, SIAEC and Cebu will explore the feasibility of potential growth opportunities for its two joint venture companies in the Philippines through the expansion of line maintenance operations, growth of hangar facilities and expansion of training academy services.

"It is expected that these growth opportunities will have an estimated investment value of US$15 million to US$20 million and is likely to generate employment in the Philippines," SIAEC said.

The transaction is not expected to have a material impact on the financial performance of SIAEC in FY2018/19.