Viet Nam’s Bamboo Airways fails in $410m capital raise

Shareholders at Bamboo Airways have rejected plans for a private placement of shares to raise the company’s charter capital, leaving the chairman, Nguyễn Ngọc Trọng, to postpone the measure to a later date. As ch-aviation previously reported, the indebted carrier had intended to raise VND9.57t dong (US$410m) via the private placement later this year. The plan was to issue 996.2m shares and raise the charter capital to VND28.07t (US$1.2b), deploying the capital raised to restructuring debts and shoring up the airline’s balance sheet. However, the plan was rejected by 56.4% of shareholders at an extraordinary general meeting on April 10, local media reported. Attending were 93 shareholders holding about 93% of the voting shares. The charter capital of Bamboo Airways therefore remains at VND18.5t (US$792m). Nguyễn Khắc Hải, deputy general director of Bamboo Airways, had urged shareholders at the meeting to vote positively, saying: “The capital increase plan is only good for Bamboo Airways. We are in debt of nearly VND8t [US$343m], and if we switch from borrowed capital to equity capital the finances will be better in terms of the debt-to-equity ratio. There will also be fresh funding to maintain business activities, reduce debts gradually, and continue to bring in more aircraft for growth.” Trọng said he would hold talks with the larger shareholders and submit a new resolution for increasing the charter capital at the next annual general meeting. He assured that the fleet was operating at full capacity, that in the first quarter of this year the company would almost break even, and that “Bamboo Airways will become profitable by 2025.”<br/>