Lucio Tan has put up a special economic zone, with the P5.265-billion aircraft maintenance facility of Lufthansa Technik Philippines (LTP) as one of its first locators. LTP is the German-owned company that acquired the engineering and maintenance business of the Philippine Airlines.
Documents show that the Philippine Economic Zone Authority (PEZA) has approved the classification of the area at the Terminal 2 of the Ninoy Aquino International Airport as a special economic zone that will entitle its locators to various incentives, including income tax holidays.
LTP was 51 percent owned by Lufthansa Technik AG of Germany and 49 percent owned by Tan's Macro-Asia Corp. when the venture was first spun off by PAL. The company was later sold by Macro-Asia and is now 100 percent owned by Lufthansa AG.
With operations based at Villamor Air Base, LTP has been seeking incentives from the Board of Investments, but the agency was unable to find any provision that would qualify the company for any of the perks being offered to all registered industries.
The zone is officially owned by Macro-Asia Property Development Corp., a fully-owned subsidiary of Macro-Asia Corp.
According to PEZA documents, LTP is registered as a new export enterprise that will provide globally competitive aircraft engineering maintenance, repair and overhaul as well as aircraft components repair and overhaul.
LTP will be servicing the requirements of PAL and Air Philippines Corp., both owned and controlled by Tan, as well as other foreign commercial airlines plying the international routes to and from the Philippines.
The project is estimated to cost a total of P5.265 billion and is projected to generate some $125 million worth of exports every year while earning an annual average net income of $52.7 million. It will also create about 1,350 jobs.
Macro Asia is listed at the Philippine Stock Exchange where it is expected to raise a combined P520 million from two separate fund raising activities this year to bankroll a joint venture project with Lufthansa and to beef up its working capital.