Cathay Pacific has completed the buyback of all warrants issued to the Hong Kong SAR Government during its 2020 recapitalization. The airline paid approximately HK$1.53 billion for the warrants buyback, marking a major step in its financial recovery.
On July 31, 2024, Cathay Pacific redeemed the remaining 50% of the preference shares. These shares were also issued as part of the recapitalization. The airline paid a total of HK$2.44 billion in preference share dividends. Combined with the warrants buyback, this amounts to nearly HK$4 billion returned to the Hong Kong SAR Government.
Chief Executive Officer Ronald Lam expressed gratitude to the Hong Kong SAR Government. He also thanked the shareholders for their support during the pandemic. He stated, “I would like to once again extend my sincere gratitude to the HKSAR Government and to all our shareholders for their invaluable support during and since the pandemic. Completing the buyback of the preference shares and the warrants marks the close of a chapter in Cathay’s history. Now, we are firmly focused on the future in pursuing our vision of becoming one of the world’s greatest service brands. Cathay is spreading its wings as we embark on a bold new strategy, underscored by our recently announced commitment of more than HK$100 billion in investments over the next seven years. These substantial investments will further elevate the experience we provide to our customers and strengthen Hong Kong’s international aviation hub status with the opening of the Three-Runway System.”
Cathay Pacific is expanding and modernizing its fleet. They have more than 100 new-generation planes in their delivery pipeline. This includes narrowbody, regional widebody, long-haul widebody, and large freighter planes. The airline also holds the right to acquire over 80 extra aircraft, signifying a strong commitment to future growth.
Strengthening Financial Position After Recapitalization
The completion of the warrants buyback and redemption of preference shares signifies Cathay Pacific’s strengthened financial position. This follows the 2020 recapitalization. The recapitalization was an important move that allowed the airline to navigate the challenges posed by the global pandemic. Cathay Pacific has fulfilled its obligations to the Hong Kong SAR Government. Now, it is positioned to focus on its strategic goals and investment plans.
The airline’s commitment to invest over HK$100 billion in the next seven years is clear. This demonstrates its dedication to enhancing customer experience. It also shows their aim of reinforcing Hong Kong’s status as an international aviation hub. The upcoming opening of the Three-Runway System at Hong Kong International Airport will further support these objectives.
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