Thai Airways Reduces Government Stake to 27.2% After Debt-Equity Swap
Thai Airways International has witnessed a significant reduction in government shareholding, with Thailand’s Ministry of Finance decreasing its stake from 47.86% to 27.2%. This change comes as a result of a comprehensive debt-to-equity conversion scheme aimed at restructuring the national carrier’s capital and reducing its debt burden. Despite the reduction, the Ministry of Finance remains the largest shareholder of the airline.
The recent equity conversion involved the allotment of 20,989,446,278 shares out of a potential total of 21,677,214,622 shares, each valued at THB 2.55 (approximately USD 0.073). The conversion scheme attracted participation from various entities including financial institutions holding unsecured debt, major non-financial shareholders who extended loans to the airline, and financial creditors entitled to residuals from an earlier aircraft disposal program.
The transformation in shareholding structure has introduced new significant shareholders. Bangkok Bank has emerged as the second-largest shareholder with a 10.35% stake following its participation in the conversion scheme. Krungthai Bank now holds the third-largest share at 5.73%. Other state-owned entities have also adjusted their holdings, with the Government Savings Bank owning 1.93%, the Islamic Bank of Thailand holding 1.71%, and the Import-Export Bank of Thailand having a 0.72% stake. Additionally, the National Telecom Public Company Limited has converted its debt into a 0.56% shareholding.
Collectively, these changes mean the Thai government now indirectly controls a 32.1559% stake in Thai Airways through various state-owned entities. This strategic shift is part of Thai Airways’ broader capital restructuring plan, which also included a THB 44 billion (USD 1.3 billion) rights offering. This financial restructuring has allowed the airline to convert billions of dollars of debt into equity, substantially cleaning up its balance sheet.
Thai Airways is poised to complete its capital restructuring soon, with plans to exit the business rehabilitation process in the upcoming year and a goal to relist on the Thai Stock Exchange by mid-2025. This reorganization is aimed at revitalizing the carrier, allowing it to navigate the challenges of the aviation industry more effectively and to pursue sustainable growth in the years to come.
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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com