STATUS REPORT RE PROPOSED SALE OF AIR AMERICA COMPLEX AND DISPOSITION OF SOUTHERN AIR TRANSPORT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80M01066A001100140009-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 4
• Document Creation Date: December 16, 2016
• Document Release Date: November 15, 2004
• Sequence Number: 9
• Publication Date: September 13, 1973
• Content Type: MF

lid "S 73 s~T S
Approved F elease 2004/12/0? FA?F DP80M010 001100140009->J/-7173-3/7d/j
13 September 1973
MEMORANDUM FOR: Deputy Director for Management and Services
SUBJECT : Status Report Re Proposed Sale of Air America
Complex and Disposition of Southern Air Transport
Attached herewith are the two status report memoranda requested
by Mr. Colby. They are unclassified and hopefully follow the terms of
reference requested by you. I have coordinated these memoranda with
Mr. Greaney, Office of General Counsel, and will furnish copies of the
memoranda to the Office of Legislative Counsel and Chief, East Asia
Division for their information.
Special Assistant to the
Deputy Director
for Management and Services
Approved For Releas
2004 1 _2/0 ):;C -R PSOM01U6~400110014000-8
25X1
25X1
 Approved FqRelease 2004/12/01: CIA-RDP80M01Q A001100140009-8
Earlier this year, the Pacific Corporation determined"
that it might sell its holdings-in Air America Inc., Civil.
Air Transport Co. Ltd., Inc. and the Thai Pacific Company
Ltd. providing that the following conditions were met: The
sale would be on a cash basis without an exchange of stock;
the companies' liabiTities to its employees would be
guaranteed by tfe purchaser; and the purchaser would con-
tinue to operate the Company and maintain the same flying
capabilities-as are now being maintained. It was understood
that the. purchaser would hopefully continue to operate the
companies for the indefinite future but a sale condition
would require the purchaser to continue operations of the
Company at least until 30 June 1974:`-""-__
With a view toward sale,' the Pacific Corporation engaged
a consultant firm, R. Dixon Speas Associates, to conduct a
study and prepare a report relative to the assets to be sold
as well as to identify potential bidders who might be interested
in purchasing the assets. U. S. Government customers of Air
America were notified as to the possibility of sale and in
July 1973 a bidders' conference was held with approximately
ten prospective bidders present. At the conference all pro-
spective bidders were furnished with a copy of the R. Dixon
Speas Associates' study and invited to travel to the Far East
and Southeast Asia, at their expense, to see the assets being
sold. In early August, five bidders who indicated interest in
acquisition of the assets did visit properties in the Far
East and Southeast Asia and on their return all indicated an
interest in bidding on the assets. Invitations to Bid were
sent to those professing interest and a deadline for submission
of bids has been set for 15 October 1973. In the meantime, the
Pacific Corporation is endeavoring. to answer questions raised
by the various bidders as to the properties being sold.
At the present time there are several possible obstacles
to the sale of the Company. First of all, any purchaser of
the Company must be acceptable to the Nationalist Chinese on
Taiwan since a major portion of the assets lies in that country.
Any bidder must be acceptable as a foreign investor to the
Chinese and as of this date the Chinese have not been contacted
Approved For Release 2004/12/01: CIA-RDP80M0l066A001100140009-8
 Approved For Release 2004/12/01: CIA-RDP80M01066A001100140009-8
regarding this matter. It is anticipated this will be done
in the near future and certainly any successful bidder will
want to assure himself of the acceptability of his company
to the Chinese Government.
Secondly, any purchaser must be capable of operating
the companies involved in a manner so that they furnish the
U.S Government in the Southeast Asia with the same service
as furnished in the past. While all the potential bidders
represent substantial companies who should qualify in this
regard, these qualifications have not yet been established.
Finally, while several companies profess sincere interest,
no bids have yet been received and will not be received
until approximately 15 October 1973, if then. At the present
time Government contracting for flying service has been
drastically reduced and the U.S. Government requirements for
flying service in that part of the world may not be sufficient
to entice a bid for the Company.
The next milestone in the proposed sale will be 15
October when bids are due. If a suitable bidder is identified,
who meets the criteria established for sale, and if suitable
arrangements can be made with the Nationalist Chinese for the
transfer of ownership of the Taiwan assets to a new company, then
the Pacific Corporation may be able to negotiate a sale of its
holdings in the Far East and Southeast Asia. If neither of
the above contingencies occur, the Pacific Corporation is pre-
pared to continue to operate these wholly owned subsidiaries
at least through Government Fiscal Year 1974.
Approved For Release 2004/12/01: CIA-RDP80M0l066A001100140009-8
 25X1 Approved For Release 2004/12/01 : CIA-RDP80M01066AO01100140009-8
Next 2 Page(s) In Document Exempt
Approved For Release 2004/12/01: CIA-RDP80M01066AO01100140009-8