Executives at All Nippon Airways Holdings (ANA HD) and Philippine Airlines (PAL) began their new strategic partnership Friday after completing signing ceremonies in Tokyo.

ANA HD has invested $95 million in PAL Holdings, giving it a 9.5% stake in the company. The investment was announced Jan. 29.

The Feb. 8 signing was attended by PAL president and COO Jaime Bautista, PAL Holdings director and Trustmark Holdings Corp. president Michael Tan, ANA Holdings president and CEO Shinya Katanozaka and ANA president and CEO Yuji Hirako.

Both sides expressed confidence that the partnership will allow each airline to grow in the Asia-Pacific market generally and the Japan-Philippine market specifically.

ANA and PAL have codeshared since 2014. ANA flies 14 flights weekly to the Philippines while PAL operates 84 flights weekly on nine routes to Japan, linking a total of 16 Japanese and 11 Philippine destinations.

By deepening the relationship, the companies expect to be able to increase connections and tap into a growth market. While 80% of passengers on Japan-Philippines flights are traveling for leisure, recent changes in Japanese laws relaxing visa restrictions on business travelers are expected to boost premium demand.

The airline executives said they will also look to share marketing skills and seek collaborative opportunities in ground handling and catering services. ANA already takes care of PAL’s ground handling at Tokyo Haneda Airport.

Bautista noted ANA’s strong service reputation—the airline has been awarded a Skytrax 5-star rating for six consecutive years—and said the partnership was a “new beginning between Japan’s largest and finest airline and the flag airline of the Philippines that would build on several years of robust cooperation.”

ANA has been a Star Alliance global alliance member for 20 years and has antitrust joint ventures with fellow Star carriers Lufthansa and United Airlines. PAL is one of the few major flag carriers not to be part of a global alliance. Neither company is yet talking about PAL potentially joining Star. But the stake does build on ANA HD’s strategy of expanding its network in the Asia-Pacific market partly through equity partnerships. In 2016, the company took an 8.8% stake in Vietnam Airlines, a SkyTeam global alliance member that also operates in a fast-growth market.

“PAL is the oldest flag carrier in Asia, established in 1941, and is a fine partner with a long and proud history and which operates in a high-growth rate market,” Shinya said.

Hirako said the airlines operate in island countries noted for their spirit of hospitality and where air traffic between them is growing at 10% annually. “This extended partnership will serve as a bridge to further promote economic growth,” he said.

Karen Walker karen.walker@informa.com