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Guangxi province increases stake in GX Airlines via equity restructuring
Posted on Thursday, 13 June 2019 10:11
The owners of Guangxi Beibu Gulf Airlines (GX Airlines) have signed an equity restructuring framework agreement similar to that of Urumqi Airlines in November 2018 to realise the municipal government’s holding via a share transfer, capital increase and stock expansion.
A subsidiary of HNA’s Hainan Group, namely Tianjin Airlines, currently owns 70.0 per cent of the Nanning airport-based carrier, which has a fleet of 28 aircraft and 60 domestic and international routes.
Beibu Gulf Investment, a wholly-owned unit of the State-owned Assets Supervision and Administration Commission of the State Council, holds the remaining 30.0 per cent.
Officially established in 2015, GX Airlines launched its first international service - Nanning-Siem Reap - in May 2018 and intends to add further router, to destinations such as Hanoi and Manila, over the next two years.
The carrier was ranked 21st by the Centre for Asia Pacific Aviation based on international seat capacity and number of international routes for the week commencing 25th February 2019.
In a March publication, the advisory consultancy noted international players are losing market share in the country as local carriers have stepped up to expand aggressively by launching more long-haul flights, as well as short-medium haul routes.
According to yesterday’s statement, the proposal to restructure GX Airlines’ equity would support plans of developing, opening up, and turning China’s southwestern central region into an important gateway for the belt and road initiative.
The aviation and tourism sectors are ways of building international channels and routes with countries in the Association of Southeast Asian Nations, as well as within China.
The proposed restructuring of GX Airlines’ equity would result in Tianjin Airlines’ holding being adjusted downwardly to 24.0 per cent while Beibu Gulf is expected to increase its stake to 71.2 per cent.
Meanwhile, the agreement would introduce Guangxi Airport Management Group, a wholly-owned subsidiary of the State-owned Assets Supervision and Administration Commission of Guangxi, as a new shareholder with 4.8 per cent.
© Zephus Ltd