Jun. 12, 2012 (China Knowledge) – China Southern Airlines Co<600029
>, the country's largest air carrier by fleet size, announced yesterday that it will raise RMB 2 billion via sales of A-shares to its parent company, China Southern Air Holding Company, through a private placement.
In a statement filed with Shanghai Stock Exchange
, the air carrier said that it plans to issue no more than 456 million shares at a price of RMB 4.3 apiece, and all the proceeds from the deal will be used to repay bank loans.
At present, the company had US$567 million or RMB 3.59 billion in bank loans.
The issue will lower China Southern Airlines' debt/asset ratio, reduce its financial risks and make its financial structure steadier, said the company.
As of March 31, 2012, the company's total asset reached RMB 132.3 billion with a debt/asset ratio of 71.17%.