The Cathay Group announced that it fully repaid the Hong Kong SAR (HKSAR) Government's HK$19.5 billion investment made during the height of the COVID-19 pandemic.
The Cathay Group has now bought back the remaining 50% – HK$9.75 billion – of the preference shares that were issued to the HKSAR Government as part of the Cathay Group's 2020 recapitalisation.
The Cathay Group previously bought back the initial 50% of the preference shares in December 2023.
In addition, the Cathay Group has paid the remaining preference share dividends up to July 31, 2024, bringing the total amount of preference share dividends paid to the HKSAR Government over its holding period to HK$2.44 billion.
"Today marks an important milestone for Cathay as we fully repay the invaluable support that the HKSAR Government provided to us during our recapitalisation," said Ronald Lam, chief executive officer of the Cathay Group.
"Our journey to rebuild Cathay for Hong Kong has been progressing well, and this has enabled us to fully redeem the preference shares only 18 months after Hong Kong reopened. We are extremely grateful for the support and guidance that the HKSAR Government, its two observers to the Board, and all of our shareholders have shown Cathay, both during and since the pandemic."
Lam noted that Cathay's focus from now is "firmly on the future."
"We continue to make substantial investments to grow Cathay for the long term and deliver on our ongoing commitment to being a positive driving force supporting Hong Kong’s international aviation hub development," he added.
The Cathay Group's overall HK$39 billion recapitalisation financing in 2020 comprised three tranches: the issuance of HK$19.5 billion preference shares with warrants to the HKSAR Government, an HK$11.7 billion rights issue of ordinary shares to existing shareholders, and a HK$7.8 billion bridge loan facility provided by the HKSAR Government, which was not utilised and expired on June 8, 2023.
In addition to buying back the preference shares and paying preference share dividends to the HKSAR Government, in May this year, the Cathay Group made its first dividend payment to ordinary shareholders since 2019, totalling HK$2.8 billion.
