Vietjet’s Recent Bond Issuance and Financial Restructuring Plans
The Việt Nam-based airline Vietjet has made headlines with its latest financial maneuverings, specifically through a successful bond issuance. As reported by the Hà Nội Stock Exchange (HNX), the airline has raised significant funds from this initiative, aiming to restructure its debts and enhance its operational capabilities.
Successful Bond Issuance
From December 11 to December 19, Vietjet managed to issue 30,000 bonds under the code VJCH2429006. Each bond carries a face value of VNĐ100 million (approximately US$3,930), contributing to a remarkable total of about VNĐ3 trillion in raised capital. This marks Vietjet’s third successful bond issuance within the fourth quarter of 2024, highlighting the airline’s active strategy in financial markets.
Previously, on October 25 and November 29, the airline issued two additional batches of bonds, VJCH2429004 and VJCH2429005, each valued at VNĐ1 trillion. The recurring theme of these financial products is a five-year maturity, showcasing Vietjet’s commitment to long-term financial planning.
Debt Restructuring Focus
The funds acquired from these bond issuances are expected to play a pivotal role in restructuring Vietjet’s debts. Specifically, the airline aims to handle several upcoming principal payments for previously issued bonds. The due bonds include VJCH2124005 worth VNĐ1 trillion, which was due on October 27, VJCH2124006 (VNĐ1 trillion, due on December 1), and VJCH2124007 (VNĐ3 trillion, due on December 27). This strategic approach allows Vietjet to manage its liabilities while continuing operations effectively.
Shareholder Engagement and Future Plans
In a proactive move, Vietjet’s Board of Directors recently sought shareholder feedback on proposals regarding private share placements and the allocation of proceeds from the bond offerings. Shareholders have until December 26 to respond, indicating a planned approach to stakeholder engagement.
The airline intends to issue 50 million shares at a bid price of VNĐ100,000 per share, aiming to raise another VNĐ5 trillion. This measure is designed to strengthen the airline’s financial footing and expand its capital base.
Anticipated Investors and Issuance Rate
Two notable investors are expected to take part in this share issuance: Dynamic & Development Investment JSC and Aviation Holdings Company. The proposed issuance rate stands at 9.23%, which could significantly boost the airline’s charter capital to nearly VNĐ5.92 trillion. This infusion of capital is crucial for Bebjet’s autonomy and growth trajectory as it aims to capitalize on the recovering aviation market.
Allocation of Raised Capital
The strategic allocation of the anticipated VNĐ5 trillion raised from the share offering is noteworthy. Vietjet plans to channel VNĐ1.8 trillion towards repaying MBB credit contracts that are due on September 1, VNĐ1.5 trillion for VietinBank credit contracts maturing on July 29, VNĐ1.2 trillion for repayments due on May 22 at the Vietnam Maritime Commercial Joint Stock Bank, and VNĐ500 billion for credit contracts set to mature on November 26 at the Vietnam International Commercial Joint Stock Bank. This detailed allocation underscores Vietjet’s focus on financial responsibility and strategic debt management.
By actively managing its financial obligations while seeking out new capital, Vietjet is positioning itself to navigate the complexities of the aviation industry with greater agility and strength. As they pursue these financial initiatives, the airline remains focused on maintaining operational excellence and customer satisfaction in the competitive air travel market.