Singapore Airlines (SIA) says it will be using a further $1.8 billion out of the $8.8 billion raised in gross proceeds from its rights issue.
Of the $1.8 billion, some $0.6 billion will fund its operating expenses, and another $0.5 billion will go towards the refund of tickets sold on flights which have been subsequently cancelled.
See: Does SIA need to make another cash call soon?
A further $0.7 billion has been applied towards debt service. This includes the periodic interest payments for SIA’s unsecured and secured loans and repayment of funds previously drawn under certain lines of credit.
So far, the airline has utilised $6.2 billion between June and August 2020 since its rights issue, including the one-time utilisation of $2.0 billion to repay the bridge loan from DBS and $1.3 billion for operating expenses during the period.
See also: SIA to use $2.2 bil from rights issue proceeds to fund operating expenses, aircraft purchases, and debt service and SIA to use $2.2 bil from rights issue to repay bridge loan facility with DBS, fund operating expenses
“Such use of proceeds is in accordance with the intended use of proceeds stated in the Offer Information Statement,” says the airline in an SGX filing dated Oct 19.
According to SIA, the company has raised $2.1 billion via loans secured on its aircraft and a short-term unsecured loan. It also has some $1.9 billion of lines of credit available for drawing and up to $6.2 billion of mandatory convertible bonds to be issued.
Since Covid-19 has halted flights, SIA has also found other initiatives including the conversion of two of its A-380 planes into a restaurant on Oct 24 and Oct 25, a tour of its training facilities, as well as the delivery of its meals from its first class and business menus.
On Oct 12, seats on SIA’s A-380 lunches were sold out within 30 minutes after bookings opened.
See also: Why SIA's seats on its superjumbo-turned-restaurant sold out
Shares in SIA closed 2 cents higher or 0.6% up at $3.53 on Oct 19.
See also:
- SIA secures $10 bil from rights issue and secured and unsecured credit facilities to 'tackle challenges' posed by Covid-19
- SIA rights shares fully subscribed but shareholders snub MCBs
- Right issue price 'in line with market precedents', says SIA
- SIA plunges into 4Q loss of $732.4 mil as air travel collapses
- Singapore Airlines to raise $15 bil via rights issue of new shares, mandatory convertible bonds
- Temasek to lead $15 bil rescue of SIA
