Hainan Airlines to raise RMB 3 bln through private placement
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Hainan Airlines Co<600221><900945>, China's fourth-largest air carrier, said that it will raise RMB 3 billion through private placement.
The company plans to issue a total of 595.24 million new shares to the Hainan provincial government and HNA Group at a price of RMB 5.04 per share, according to a statement.
The airline said that RMB 2.05 billion of the proceeds will be used to repay bank loans and that the remaining funds will be used to replenish the company's working capital.
If the move receives approval from shareholders, the carrier's debt ratio will be cut to 76.11% from 82.8%. As of Mar. 31, the company's total assets were RMB 51.28 billion, while total debts were RMB 44.58 billion.
The company on Saturday posted a net loss of RMB 1.42 billion for 2008. Its net profit slumped 89% year on year to RMB 32.82 million in the first quarter of 2009.
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