Cebu Pacific operator moves crucial P12.5-B share sale to March

The Gokongwei family’s Cebu Air Inc., operator of budget airline Cebu Pacific, said an almost P12.5-billion share sale partly aimed at weathering the impact of the COVID-19 pandemic has been moved to March.

The company said in a stock exchange filing on Thursday the offer period would now run from March 3 through March 9 this year. It was previously set from Feb. 26 to March 4.

The company is offering convertible preferred shares to existing stockholders, otherwise known as a rights offering.

The conversion price would range from P38 to P45 per share although the final price was targeted to be set on Feb. 15. Cebu Air rose 0.8 percent to P50.40 per share on Thursday’s close.

The move was part of an ongoing “business transformation” program as the company deals with the impact of the collapse in air travel demand.

The added funds would be principally used to strengthen its balance sheet by paying down debt and maintaining operations.

Cebu Air said P4.8 billion was allocated for paying advances made by affiliate JG Summit Philippines Ltd. and P3.33 billion for debt repayments due in 2021.

It would further spend P3.9 billion for aircraft operating lease payments due this year and another P384 million for general expenses and passenger refunds.