National Citizen Bank to sell shares of Bamboo Airways

Tuesday, May 09, 2023 11:01

A Bamboo Airways plane. Bamboo Airways currently has charter capital of VND18.5 trillion (US$789 million), equivalent to 1.85 billion shares. — Photo

The National Citizen Joint Stock Commercial Bank (NVB) plans to sell 203 million shares of Bamboo Airways, equivalent to 11 per cent of the airline's current capital.

NVB has just announced a resolution to collect shareholders' written opinions on the sale of 203 million shares of Bamboo Airways, owned by property developer FLC Group.

The above shares are part of the collateral of the loans of FLC at NVB. In addition to this bank, Trinh Van Quyet, former chairman of FLC, and other shareholders also used Bamboo Airways shares as collateral for loans at many other banks such as Sacombank and the Orient Commercial Bank.

Bamboo Airways currently has charter capital of VND18.5 trillion (US$789 million), equivalent to 1.85 billion shares. Thus, the number of shares that NVB holds is equivalent to 11 per cent of the current capital of this airline.

In early April, the Board of Directors of FLC Group also had a resolution approving the policy of transferring shares of Bamboo Airways owned by FLC.

At the recent extraordinary general meeting of shareholders in 2023, the Board of Directors of Bamboo Airways submitted to shareholders a plan for the private placement of ordinary shares to increase charter capital.

Under the plan, Bamboo Airways will increase charter capital through the issuance of shares to restructure loans and issue shares to new investors.

Bamboo Airways will issue 772 million shares at par value of VND7.72 trillion to swap debts into shares according to the agreement between the airline and creditors.

The issue price and expected swap ratio are VND10,000 per share, equivalent to a 1:1 swap ratio, meaning VND10,000 can be swapped for 1 share.

Bamboo Airways also plans to issue 185 million shares to new investors. The Board of Directors was authorised to seek and decide on the criteria for selecting investors and the number of shares to be offered to each investor. The expected issue price for new investors was also VND10,000 per share.

If the above issuance plans had been successful, Bamboo Airways would have collected VND1.85 trillion, at the same time, write off a debt of VND7.72 trillion and increase charter capital by VND9.57 trillion to VND28.07 trillion.

However, after submitting to shareholders, only 43.56 per cent of the voting shares approved the above private placement plan and 56.42 per cent of the voting shares disapproved. Therefore, this option was not passed.

Shareholders discussed and decided that more time was needed to finalise the most feasible capital increase plan for Bamboo Airways. After completion, the capital increase plan will be submitted to the nearest General Meeting of Shareholders for approval.

At the meeting, Bamboo Airways Chairman Nguyen Ngoc Trong said that he would work again with shareholders with a large ownership rate and will submit to shareholders the capital increase plan at the nearest meeting. According to Trong, this plan is aimed at effectively restructuring loans and supplementing business capital for the company. — VNS

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