Thursday, 26 December 2024
Airlines

Cathay Pacific fully repays Hong Kong Government’s HK$19.5 billion investment

Airline reaches key milestone in post-pandemic recovery

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(Photo: Transport Pixels from England, CC BY 2.0, via Wikimedia Commons)

Cathay Pacific has fully repaid the HK$19.5 billion investment made by the Hong Kong Special Administrative Region (HKSAR) Government in 2020, marking a significant step in the airline’s recovery from the COVID-19 pandemic.

The final HK$9.75 billion payment, representing the remaining 50% of preference shares issued to the HKSAR Government, was made on July 31, 2024. Cathay Pacific had previously bought back the initial 50% in December 2023.

In addition to the share buyback, the airline has also paid all outstanding preference share dividends, totaling HK$2.44 billion over the holding period.

“Today marks an important milestone for Cathay as we fully repay the invaluable support that the HKSAR Government provided to us during our recapitalisation,” said Cathay Group Chief Executive Officer Ronald Lam.

“Our journey to rebuild Cathay for Hong Kong has been progressing well and this has enabled us to fully redeem the preference shares only 18 months after Hong Kong reopened.”

Lam emphasized the airline’s commitment to Hong Kong’s future, stating, “As we turn the page on this significant chapter in Cathay’s history, our focus now is firmly on the future. We continue to make substantial investments to grow Cathay for the long term, and deliver on our ongoing commitment to being a positive driving force supporting Hong Kong’s international aviation hub development.”

The 2020 recapitalization package, totaling HK$39 billion, included the preference shares, an HK$11.7 billion rights issue to existing shareholders, and an unused HK$7.8 billion bridge loan facility.

This repayment comes on the heels of Cathay Pacific’s first dividend payment to ordinary shareholders since 2019, amounting to HK$2.8 billion, which was distributed in May 2024.

Written by
Dirk Andrei Salcedo

Dirk is the founder and editor-in-chief of Aviation Updates Philippines (AUP), a platform dedicated to providing the latest news and insights on the aviation industry in the Philippines. With a strong passion for aviation and a background in computer engineering, he manages all aspects of AUP, from website development to content curation.

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