Viet Nam’s Bamboo Airways eyes US IPO, boosts capital

Bamboo Airways (QH, Hanoi) is considering an initial public offering (IPO) in the United States in the third quarter of this year in which it would look to raise up to USD200 million, its chairman Trinh Van Quyet revealed to Reuters on April 14. The move may offer a stake of between 5% and 7% in the IPO, in which the company could potentially secure a market capitalisation of up to USD4 billion, the chairman said, adding: “The IPO will be part of our efforts to expand our services globally.” Owned by Quyet’s FLC Group, a Vietnamese property and leisure conglomerate, Bamboo Airways has been working on a possible offering on the New York Stock Exchange together with an international auditing firm. As previously reported, less than a month ago Quyet told Bloomberg News that Bamboo Airways intended to debut on either the Ho Chi Minh City Stock Exchange or the Hanoi Stock Exchange no later than the third quarter, anticipating a market capitalisation of about USD2.7 billion. But Quyet told Reuters that this was now “a backup plan, depending on market conditions.” The chairman also reiterated earlier plans that the airline will increase its all-leased fleet to 40 aircraft by the end of 2021, from 29 now, and that it was aiming at launching flights to the US, Australia, Germany, Japan, and the United Kingdom this year if pandemic-related conditions improve. According to the ch-aviation capacities module, it currently operates a domestic-only network of 54 routes. Bamboo Airways “will start conducting chartered flights to the US in July and target the launch of non-stop commercial flights between Ho Chi Minh City and San Francisco, CA in September, with an initial frequency of three flights per week,” he said. The company plans to build on both its profits and its market share in 2020, from a VND400 billion dong (USD17.3 million) profit last year to VND500 billion (USD21.7 million) in 2021, with market share rising from 20% in 2020 to 30% by the end of 2021. In related news, Bamboo Airways continues to increase its registered charter capital, announcing on April 15 a rise to VND12.5 trillion (USD542 million) from VND10.5 trillion (USD455 million), the second such increase since the beginning of the year. Bamboo Airways’ charter capital began in May 2017 with an initial investment of VND700 billion (USD31 million at the time). According to financial data, Quyet himself holds a 43.24% stake in the airline, FLC Group holds 39.4%, and FLC Faros Construction holds 8.57%.