Government fund subscribes to Vietnam Airlines right issue
In this article (5)
Vietnam’s sovereign fund has subscribed to Vietnam Airlines’s rights offering amid its accumulating losses due to Covid-19.
The State Capital Investment Corporation (SCIC) paid VND6.89 trillion ($303.56 million) to acquire 689.5 million shares and kept its ownership rate in the state-owned carrier at 31.08 percent.
The airline’s HVN ticker rose by the maximum allowed 7 percent Monday, its sixth consecutive day of gain.
HVN’s issued VND8 trillion worth of stocks to existing shareholders to increase its capital.
Japan’s ANA Holdings, the operator of All Nippon Airways which owns an 8.77 percent stake in Vietnam Airlines, sold its rights to buy 70 million shares to Vietnam Airlines employees since it is itself facing financial difficulties.
The carrier estimates its losses for the first half of 2021 at around VND10.79 trillion.
Questions & Answers
Q.What was the purpose of the rights offering by Vietnam Airlines?
What was the purpose of the rights offering by Vietnam Airlines?
Vietnam Airlines issued VND8 trillion worth of stocks to existing shareholders. This was done to increase its capital, following accumulating losses largely attributed to the impact of Covid-19 on the airline.
Q.How much did Vietnam’s sovereign fund invest in Vietnam Airlines' rights issue?
How much did Vietnam’s sovereign fund invest in Vietnam Airlines' rights issue?
The State Capital Investment Corporation (SCIC), Vietnam’s sovereign fund, invested VND6.89 trillion, equivalent to $303.56 million. This payment secured 689.5 million shares, maintaining its 31.08 percent ownership.
Q.What were the estimated losses for Vietnam Airlines in the first half of 2021?
What were the estimated losses for Vietnam Airlines in the first half of 2021?
The carrier estimates its losses for the first six months of 2021 were approximately VND10.79 trillion. These losses contributed to the need for the rights offering and capital increase.
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