Government-led Thai Airways B80 billion fundraising plan

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FILE PHOTO: Thai Airways planes are parked on the tarmac at Bangkok’s Suvarnabhumi International Airport March 27, 2015. (Reuters)

Thai Airways International Plc will receive key financial support from the government for its 80 billion baht capital raising and debt-equity swap plan to help the state-controlled carrier emerge from its pandemic-induced bankruptcy .

State-owned banks will lead the funding of new loans, debt swaps and equity injection into Thai Airways as part of a revised overhaul plan the airline submitted for court approval last month , Finance Minister Arkhom Termpittayapaisith said in an interview with Bloomberg News on Monday. . The ministry and other agencies will continue to maintain a combined stake of at least 40%, but the proportion will not exceed 50% to incentivize the carrier to remain competitive, he added.

The carrier plans to exit its court-supervised debt restructuring plan by 2024. It filed for bankruptcy protection in 2020, after posting losses every year from 2013. But a rebound in transport Global airline boosted its cash flow and reduced the amount of loans specified in the court’s original plan.

“Thai Airways’ situation is much better,” and that has boosted creditors’ and shareholders’ confidence in its survival and future, Mr Arkhom said. State-owned banks will be able to offer the full 13 billion baht of new loans the airline is currently seeking, about half of the 25 billion baht previously requested. The revised amount can be fully financed by state banks, he said.

The reopening of Thailand’s borders and those of other countries will also support cash flow. The airline’s most profitable flights are those with connections in Europe.

The improved finances and capital-raising plan will accelerate the resumption of trading in the airline’s shares, which were suspended in May, he said. The previous timeline for the resumption of trading was in 2025.

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