Bamboo Airways finds new investor to replace FLC
Bamboo Airways confirms that the airline is in the negotiation stage and has completed part of the procedures with a new investor.
Bamboo Airways has found a new investor. Photo: Bamboo Airways.
Speaking to Zing, a representative of Bamboo Airways confirmed that the company has found a new investor to replace the previous shareholders, former Chairman Trinh Van Quyet and related shareholders of FLC Group.
The representative stated that as the issuer, Bamboo Airways actively supported the transfer of shares from the old shareholders to the new investor. The transfer was conducted under the supervision of state agencies in accordance with the law and was approved by the competent authorities.
In addition to paying the share purchase price, the new investor has agreed to inherit and take responsibility for the payment of principal and interest on previous loans that the old shareholders used their Bamboo Airways shares as collateral.
Furthermore, the new investor has also supported former Chairman Trinh Van Quyet with a separate sum of money to be deposited into a sealed account of the Investigative Police Agency to mitigate any consequences (if any) from the case.
This representative also stated that after the Covid-19 pandemic, major events related to high-level personnel caused the airline to face numerous difficulties in paying debts to credit organizations. At that time, the airline called for support from some large investors to help overcome the crisis. For example, Him Lam Corporation lent 8,000 billion Vietnamese dong to Bamboo Airways. Thanks to this, the airline has overcome difficulties and gradually stabilized.
It is known that Him Lam Corporation is the enterprise of tycoon Duong Cong Minh, who serves as a senior advisor to Bamboo Airways since August 2022. He is also a veteran businessman with decades of experience in finance and real estate.
At the extraordinary shareholders’ meeting on March 4 of FLC Group, Mr. Le Ba Nguyen, Chairman of FLC’s Board of Directors, also announced the company’s plan to transfer ownership stake in Bamboo Airways.
According to FLC’s leader, the group’s investment in the airline is VND 4,015 billion, equivalent to 21.7% of Bamboo Airways’ charter capital.
In 2021, the airline operated without profit, so FLC had to set aside provisions for the investment of over VND 373 billion. This provision continued to increase sharply in 2022 to VND 3,642 billion. This is also one of the investments that caused FLC to set aside the most provisions by the end of 2022.
Bamboo Airways was established by FLC on May 31, 2017, with an initial charter capital of VND 700 billion, in which the group held 100%. Through several capital increases, FLC’s ownership stake in Bamboo Airways gradually decreased.
As of April 2022, according to the report of the Civil Aviation Authority of Vietnam, FLC was the largest shareholder contributing over VND 3,580 billion to Bamboo Airways and held 51.24% of the airline’s capital. Besides, former Chairman of FLC Trinh Van Quyet also contributed over VND 2,800 billion, equivalent to 40.03% of the capital, and other shareholders contributed over VND 610 billion, holding 8.73%.
In the latest financial report, FLC’s ownership stake in the airline had decreased to 21.7% on the total charter capital of VND 18,500 billion, corresponding to the investment amount of VND 4,015 billion.
Regarding the operation of Bamboo Airways, in the first two years of operation from 2019-2020, FLC said that the airline made a profit. However, in 2021-2022, the Covid-19 pandemic severely affected the airline’s operations, leading to continuous losses, and FLC had to set aside billions of Vietnamese dong for the investment here.
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