Hong Kong government extends Cathay Pacific’s bridge loan for one year
According to a press release, the Hong Kong government has extended the drawdown period of the Cathay Pacific airline’s credit facility by twelve months, until June 8th, 2023. The loan amounts to $7.8 billion Hong Kong dollars.
Initially, the sum was part of the 39 billion Hong Kong dollars recapitalization announced on June 9th, 2020. At the time, the aim of the move was to help the airline maintain its operating volume and competitiveness amid the airline industry shutdown due to the COVID-19 pandemic.
Augustus Tang, Cathay Pacific’s CEO, expressed appreciation for the «ongoing support» and «continued confidence» from the administration. «Despite the difficult operational environment, we have not had to draw down the facility over the past twelve months», he stressed. Finally, he also assured that «the further extension of the drawdown period is greatly appreciated» and «will provide flexibility» to manage the company’s liquidity.
According to Cathay Pacific, its liquidity «remains at a healthy level». The data provided indicates that it stood at 30.3 billion Hong Kong dollars at the end of 2021. The figure represents a notorious increase compared to the 28.6 billion reported at the end of 2020.
Now, against a backdrop of recovering demand and capacity on offer, the airline is consolidating its recovery, broadly in line with what is happening in the rest of the market. «The unprecedented impact of the pandemic has necessitated some very difficult decisions, namely our restructuring in 2020; but through this and our recapitalization, we have created a more efficient, more competitive and more focused business», Tang concluded.
See also: CAPA Leader Summit: Sir Tim Clark says Cathay Pacific’s future is «anybody’s guess»
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