Financing to Lower Debt: Funding to be Injected by the State to Support China Southern
Airlines Company Limited (Stock Code of Shanghai Stock Exchange: 600029; Hong
Kong Stock Exchange: 01055; NYSE: ZNH) (hereinafter referred to as “CSA” or
the “Company”) announced that the Company intends to raise funds through the
non-public issuance of A Shares and H Shares. This exercise will help reduce
the Company’s gearing ratio, improve its capital structure and enhance its
ability to mitigate risk. China Southern Air Holding Company (“CSAHC”), its
parent company, has undertaken to use the full amount of the State’s injected
funding of
non-public issue basis.
CSA announced that the total proceeds from non-public issue of A Shares
will be not more than
more than 10 specific investors including CSAHC, its parent company. The
Company will also privately place new H Shares to
subsidiary of CSAHC outside
determined pursuant to the relevant laws and regulations as well as market
practices.
In the past two years, CSA has been actively seeking support from the
government to resolve the difficulties arising from insufficient capital and a
high gearing ratio. The Company already received funding from the State with
an amount of
company, in 2009. Through this financing exercise, it is expected that the
gearing ratio of CSA will be substantially reduced with a significant
improvement in the net asset per share. This is expected to lay a solid
foundation for CSA’s future development.
In 2010, benefiting from a gradual bottoming-out of the global economy,
aviation industry is expected to recover to a significant extent driven by
growth in investment, expansion in consumption and the events like the Asian
Games in
period of time in future, passenger traffic for both domestic and
international flights will continue to grow at a fast pace, and the aviation
market’s condition will further improve. Given the backdrop of revamped
development of the civil aviation industry in
well-positioned to achieve sustainable development through the funding of the
non-public issue.
About China Southern Airlines Company Limited
China Southern Airlines is one of the largest airlines in
passenger traffic volume of 66 million in 2009. CSA is headquartered in Baiyun
District,
mainland
annual passenger traffic volume. As of
187 consecutive months for safe flight operations, accumulated 6.52 million
hours safely flown, which granted it the best flight-safety record keeper
among carriers in mainland
International Air Transport Association (the “IATA”) with the IOSA (IATA
Operational Safety Audit) for its safety practices.
For more information, please visit http://www.csair.com .
Cautionary Statement Regarding Forward Looking Information:
Certain statements in this news release may contain forward-looking
information about CSA, its business and future development, its expected
financing, the overall civil aviation industry and general economy within the
meaning of the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. These statements are based on current assumptions, which
are subject to change over time. Actual results may differ materially
depending on a number of risk factors including, but not limited to, the
general economic and business conditions in
in the financial markets; changes in government regulations; increases in jet
fuel costs; natural disasters, outbreaks of disease, terrorist activities and
similar events that reduce the demand for air travel; and various other
factors beyond its control. All forward-looking statements are expressly
qualified in their entirety by this Cautionary Statement and the risks factors
detailed in the Company’s reports filed with the U.S. Securities and Exchange
Commission. CSA undertakes no duty to revise or update any forward-looking
statements to reflect events or circumstances after the date of this release.
SOURCE China Southern Airlines Company Limited