Cebu Air, Inc. secured stockholders’ support for its intention to sell convertible common securities and bonds as Cebu Pacific’s operator tries to collect $500 million (about P24.13 billion) to overcome the coronavirus pandemic.

In a Friday stockholders conference, the Gokongwei-led group said stockholders comprising 87.36 percent of their overall outstanding capital stock accepted their previously announced fundraising plans.

Specifically, the stockholders provided the go-signal to lift the company’s approved capital stock to P1.75 billion from P1.34 billion at present, establishing a new class of convertible preferred securities.

This securities would be offered for sale in a stock rights offering, producing around $250 million (about P12.07 billion) for the firm. The underlying securities of the convertible preferred shares are then listed on the Philippine Stock Exchange (PSE).

The stockholders have greenlit convertible bonds, warrants, bonds with detachable warrants and other related assets, whose corresponding common shares would also be classified on the PSE.

The initiatives are part of the Business Transformation Fundraising Plan established by Cebu Pacific to improve its balance sheet in the middle of the crisis.

When the company first unveiled this proposal in October, Cebu Air said it was failing as passenger traffic fell due to travel restrictions.

As of end-September, Cebu Pacific’s net loss hit P14.69 billion, reversing last year’s P6.77 billion profit. Revenues plummeted 70 percent to P19.34 billion, as passenger traffic declined 72 percent to 4.7 million.

Cebu Pacific said on Friday, in a separate release, introducing self-service tools to its online booking platform enabling travelers to handle their details more effectively.

“We have improved our contactless experience and accelerated our digital projects, as they give our passengers easier and better choices. Our customers remain at the core of our company, so you can expect more improvements from us to help and allow a self-service journey for all,” said Candice Jennifer A. Iyog, Cebu Pacific Vice President Marketing and Customer Experience.


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