30-Jun-2011 1:03 PM

China Airlines considers raising capital to reduce debt ratio

China Airlines is considering commencing advance payments on the carrier’s newly ordered aircraft and other small and medium sized passenger and cargo fleet this year as well as increase its capital by issuing 568.4 million ordinary shares for a price of TWD10 per share, for a total issue amount of TWD9000 million (USD312.8 million) at a tentative price of TWD16 per share, in an effort to lower the carrier’s debt ratio (China Times, 30-Jun-2011). The carrier’s debt ratio of 76% is higher than the 70% average for 15 major carriers in the Asia Pacific region. Meanwhile, 80% of the proposed shares will be made available to shareholders, 10% will be released to the market and the remaining 10% will be released to employees of the company.

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