background

• Anglo Chinese was the independent financial adviser to Cathay Pacific Airways Limited regarding the HK$39.0 billion recapitalisation proposal involving (1) proposed issue of preference shares and warrants; and (2) proposed rights issue of rights shares on the basis of seven rights shares for every eleven existing shares; and (3) proposed bridge loan facility
• Cathay Pacific mainly engaged in the provision of international passenger and cargo air transportation through its Cathay Pacific, Cathay Dragon , Air Hong Kong and HK Express segments
• The transaction drew much debate amongst the private and public sectors

 

our roles

• Extensive analysis of the terms of the rights issue
• Assessment of relevant facts and company financials
• Evaluation of the rights subscription price, potential impact on the company’s gearing position and potential dilution effect on the interests of the independent shareholders
• A rights issue of this size required an independent financial adviser with deep corporate finance experience and extensive local knowledge of the Hong Kong political and economical environment

 

key matters

• Establishing the reasonableness of the rights subscription price and the timing of the recapitalisation proposal in response to the outbreak of the global COVID-19 pandemic that created the significant challenges for the airline industry