Net proceeds from the issuance of convertible preferred shares, amounting to as much as P12.5 billion, will be used to bolster the airline’s liquidity to address its financial liabilities.
Cebu Air earlier redenominated its planned $250 million stock rights offering to Philippine peso to allow wider participation from all eligible shareholders.
Of the estimated proceeds, P4.805 billion has been allotted for repayment of an advance by parent company JG Summit Philippines Ltd., P3.913 billion for aircraft operating lease payments due in 2021, P3.328 billion allocation for principal debt repayments due in 2021 and P384 million for general corporate purposes, which are primarily for passenger refunds in case cash inflows from operations become insufficient due to the impact of the COVID-19 pandemic.
Stockholders as of record of February 26 are entitled to subscribe to the offering, which will run from March 3 to 9.
The shares will be listed on the stock exchange on March 29.
Apart from this, Cebu Air will raise another $250 million from a private placement.