Hong Kong Airlines (HX, Hong Kong International) has asked the city’s government to provide it with financial support, after the state revealed a massive HKD39 billion Hong Kong dollar (USD5 billion) bailout for flag carrier Cathay Pacific (CX, Hong Kong International) on June 9.
That bailout includes the government’s own lifeline to Cathay of HKD27.3 billion (USD3.52 billion), representing 1.5 times the company’s market capitalisation.
“We hope that the government will consider its recent airline bailout plan in conjunction with support for other Hong Kong-based carriers, which also help to maintain Hong Kong’s status as an aviation hub. We are committed to serving Hong Kong and are always open to strong strategic investors to secure our long-term development,” Hong Kong Airlines told the South China Morning Post in an email.
“We appreciate the various relief measures taken by the government to maintain Hong Kong’s status as an aviation hub. We hope that the government will consider continuing their assistance to Hong Kong Airlines, to help tide us over this difficult period,” it added.
A member of debt-shackled Chinese conglomerate HNA Group, the airline has received more than CNY1 billion yuan (USD141 million) in additional funding since January to help repay maturing debt, while also trying to find a “white knight” investor, anonymous sources told the newspaper.
Hong Kong Airlines is being kept alive by a working group in charge of HNA’s debt restructuring, and this working group has authorised several state-owned Chinese banks to provide the airline with capital, the sources explained, one of whom put the sum closer to CNY2 billion (USD282 million).
The support has spared the Hong Kong government from bailing out another troubled carrier, for now, the sources added. However, Hong Kong Airlines declined to comment on its financial activities.
