By Cris Larano 
 

MANILA--Philippine Airlines controlling shareholder Lucio Tan is again on the hunt for a strategic partner for the airline shortly after parting ways with San Miguel Corp. (SMC.PH), and aims to seal a deal within three years, the carrier's returning president, Jaime Bautista, said.

"We want a strategic investor in the next two to three years," Mr. Bautista told reporters after launching Friday the return of PAL--as the airline is popularly known--to New York after an 18-year absence. "It will be better if it is another airline or at least a company with investments in an airline," he added.

In September, a little over two years after San Miguel bought a 49% stake in the airline for $500 million, Mr. Tan--through various holding firms--bought the diversified Philippine conglomerate out of PAL, restoring billionaire Mr. Tan in full control of Asia's oldest carrier. San Miguel had initiated several projects in the airline, the most significant of which was a $10 billion re-fleeting to replace older jets with more fuel-efficient aircraft.

Mr. Bautista said the re-fleeting is now under review, including the delivery of some 28 narrow-bodied Airbus jets scheduled for delivery between 2016 and 2022. PAL now has 70 aircraft and will take delivery of 10 more Airbus jets in 2015.

He said the deployment of 15 Airbus A330s that San Miguel ordered to service Middle East routes is being assessed to maximize their usage. He said those planes are underutilized because Philippine Airlines didn't get the slots and flight frequencies it hoped to secure in the region.

For now, the airline doesn't need a fresh equity infusion, having raised though borrowings and cash flow the $1 billion used to pay San Miguel for its stake and repay shareholder advances to support the re-fleeting and operations of the airline.

Mr. Bautista said the New York route is potentially profitable since around half a million Filipinos live on the East Coast of the U.S., with 253,000 living in the New York-New Jersey area. He said PAL is aiming for at least a 30% share of the Filipino market in the area.

Listed PAL Holdings (PAL.PH) owns around 98.2% of Philippine Airlines.

Write to Cris Larano at cris.larano@dowjones.com; @CrisLaranoWSJ

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