Tigerair Taiwan (IT, Taipei Taoyuan) has applied to the Taiwan Stock Exchange to list its shares on the main board and hopes to raise more capital before international travel resumes in 2022, the low-cost subsidiary of Taiwan’s China Airlines (CI, Taipei Taoyuan) has revealed.
According to a list of such applications on the bourse’s website, the carrier lodged its request on December 28, declaring its share capital at the time of the application as TWD4 billion new dollars (USD144.2 million).
As per the rules of the stock exchange, the application said that “if the public has any opinions or doubts about the initial application for a stock listing for Tiger Airways Co. Ltd., they may express them in writing before January 12.”
The airline currently falls short of the requirements for the main board, which are stricter than for the bourse’s emerging stock board, as it posted a loss last year due to Covid-19. However, it should be eligible under relaxed listing rules for companies affected by the pandemic, the exchange told the Taipei Times newspaper.
The revised rules mean that the review committee judges an applicant by its financial results from every year apart from the coronavirus-impacted ones.
Tigerair Taiwan had said in December 2019, just before the outbreak, that it would debut initially on the emerging board - a preparatory market not open to public subscription - with the intention of moving to the main board in a formal Initial Public Offering (IPO) towards the end of 2020.
This plan echoed a filing that China Airlines issued in July 2019 announcing that Tigerair Taiwan would file an IPO application the following year.
Tigerair Taiwan reported a net profit of TWD981 million (USD35.35 million) in 2018 and TWD808 million (USD29.12 million) in 2019, before posting a net loss of TWD1.37 billion (USD49.37 million) for 2020.
“The applicant’s financial performance is just one of many factors to be considered. We will focus on its business growth potential. We will examine the airline’s business plan to see how it has adapted to the pandemic, whose development is difficult to forecast,” bourse spokeswoman Rebecca Chen told the Taipei Times.
However, she qualified that of the firms that have applied under the relaxed rules so far, not many have been approved.
Bernard Hsu, Tigerair Taiwan’s commercial director, told the newspaper that the carrier expects its main markets of Japan and South Korea to ease their travel restrictions after the Lunar New Year holiday (January 29 to February 6 in Taiwan) as vaccination rates rise.
“Some countries tightened their border controls recently due to the spread of the Omicron variant, but we think that was actually good for the aviation industry as the strict measures will help contain the pandemic. The earlier the countries contain the pandemic, the sooner they will reopen their borders,” he said.
According to the ch-aviation fleets and ch-aviation capacities modules, just one of the airline's fleet of thirteen aircraft is currently active, an A320-200N, on a single route, Taipei Taoyuan to Macau International (2x weekly). Its fleet consists of eleven A320-200s and two A320neo. It took delivery of the two neo earlier this year with two more expected to arrive in 2022 out of a total of fifteen on firm order.
If its application to be listed is approved, Tigerair Taiwan will issue new shares as China Airlines and affiliate Mandarin Airlines (AE, Taichung Ching Chuan Kang) hold a combined stake of 81.3% in the LCC, higher than the permitted limit of 70%, Hsu said. It already issued 120 million new shares in September, raising TWD3 billion (USD108 million), most of them bought by China Airlines and Mandarin.
