China Eastern Airlines intends to raise up to CNY15 billion ($2.2 billion), with the bulk of funds going towards the delivery of 38 new aircraft.
It will raise the funds through a non-public share issuance, the airline states in a stock exchange filing on 10 May.
The shares will be issued to “specific subscribers”, which will amount to no more than 35 investors, the airline adds. China Eastern parent CEA Holdings, which owns over 56% of the airline, is expected to subscribe to the newly-issued shares.
Of the CNY15 billion raised, around CNY10.5 billion will fund the aircraft deliveries, while the remainder will used to supplement its working capital.
It states: “The projects to be funded with the proceeds will facilitate the expansion of fleet size and optimisation of fleet structure, improve the company’s air transportation capacity, ensure the sound development of the company’s business, and promote the smooth implementation of the company’s strategy.”
It is unclear which 38 aircraft China Eastern will be using the funds for. Cirium fleets data show the airline has 63 jets on order, comprising 11 Airbus A320neos, eight A350s, six Boeing 737 Max 8s, as well as 28 Comac ARJ21s and 10 C919 narrowbodies.