T'way Air to Raise 200 Billion KRW in Capital...Decides on 'No-Discount' Rights Offering

On August 7, T'way Air announced that it has finalized a large-scale capital increase plan aimed at stabilizing its financial structure, and will proceed with a "no-discount" rights offering, with a focus on protecting minority shareholders.

At a board meeting held on this day, T'way Air approved three proposals for a capital increase totaling 200 billion KRW and financial structure improvement: ▲ a third-party paid-in capital increase, ▲ a capital reduction without compensation, and ▲ the issuance of perpetual bonds.

For this capital increase, Daemyung Sono Group will participate in the third-party paid-in capital increase with an investment of 110 billion KRW, based on the market price without any discount. Typically, third-party paid-in capital increases are issued at a price up to 10% lower than the market price, raising concerns about dilution of existing shareholders' equity. However, T'way Air will proceed with the capital increase at the market price without any discount, in order to protect the rights and interests of existing shareholders, including minority shareholders.

Additionally, T'way Air plans to reduce the paid-in capital and improve its capital impairment ratio through a capital reduction without compensation, by lowering the par value per share from 500 KRW to 100 KRW. This will not affect the number of shares or the ownership ratio of existing shareholders.

Along with these measures, T'way Air will also issue perpetual bonds worth 90 billion KRW. Since perpetual bonds are classified as equity in accounting, their issuance can reduce the company's debt burden and enhance its capital base.

Regarding this capital increase, T'way Air stated, "This decision prioritizes the establishment of a foundation for sustainable growth and the interests of existing shareholders above all else," adding, "By implementing these three measures simultaneously, the effect of improving the capital structure will be maximized."

This content was produced with the assistance of AI translation services.