What’s new: China Southern Airlines Co. Ltd. plans to raise as much as 17.5 billion yuan ($2.47 billion) in a private share placement to expand its fleet and replenish working capital.
The airline will use 12.25 billion yuan of the proceeds to buy 50 Airbus A320 NEO jets, China Southern said Wednesday in a statement. The expansion will help the company keep up with the recovery of civil aviation, the carrier said.
Southern Airlines currently operates 894 planes, including 344 A320 jetliners.
The background: The purchase is part of mega contracts announced in July 2022 by China’s three largest state-owned airlines for almost 300 jets with a total value of $37 billion.
The purchase represents China’s first major jetliner orders in about three years and is the largest aircraft purchase order in the history of the three airlines.
Air China Ltd. disclosed a plan last August to raise as much as 15 billion yuan through a private placement to expand its fleet. In May 2022, China Eastern also unveiled a private share placement plan aiming to raise as much as 15 billion yuan for buying planes and adding to capital.
Contact reporter Denise Jia (huijuanjia@caixin.com) and editor Bob Simison (bob.simison@caixin.com)
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