Houston-based Perea Capital, LLC, the investment manager of Perea Capital Partners, LP, has acquired a 5.25% stake in Rex - Regional Express (ZL, Wagga Wagga) in what is the first major investment by a US private equity firm in the airline.
In a December 1, 2022, filing with the Australian Stock Exchange (ASX), Perea Capital's managing partner Omar Musa said the entity had purchased 5,913,739 shares in Regional Express Holdings in a series of on and off-market trades in the preceding four months. In the process, Perea became a substantial shareholder (5% or more) and triggered a mandatory reporting requirement. On Friday, January 6, 2023, Regional Express Holdings Limited shares are trading at AUD1.45 Australian dollars (USD0.98) on the ASX, valuing Perea's investment on the day at AUD8,574,922 (USD5,797,450).
Also on December 1, Ming Yew See Toh and Hui Ing Tjoa told the ASX that they'd ceased to be substantial shareholders after selling a parcel of 4,200,000 ordinary shares in an off-market sale worth AUD6,216,000 (USD4,202,917) on November 28. Perea Capital was the buyer and acquired the remaining 1,713,739 shares in separate trades from other sellers. Before the sale, Ming Yew See Toh and Hui Ing Tjoa had a 6.62% stake in Regional Express.
The airline, which has 111,583,797 ordinary shares on issue, listed on the ASX in 2005. Regional Express Holdings posted a fiscal year after-tax loss of AUD46 million (USD31.1 million) in the year to June 30, 2022. But despite rising inflation and interest rates and dealing with the increasing cost of jet fuel, the airline now expects to turn a profit in the twelve months to June 30, 2023. Regional Express flies to 57 destinations around Australia with its fleet of seven B737-800s, twenty-two Saab 340Bs, thirty-five Saab 340B(Plus)es, and a single Saab 340A.
To date, Singaporean interests have dominated the share registry of Regional Express. The airline's executive chairman, Kim Hai Lim, is the biggest shareholder with a 16.9% stake. He is trailed by Joe Tiau Tjoa, the managing director of the Singaporean wholesaler, Greatland, with a 14.4% stake. Regional Express board member Thian Soo Lee with a 6.36% stake is the third biggest shareholder, with Joo Chye Chua fourth with a 6.62% stake. With Ming Yew See Toh and Hui Ing Tjoa selling the majority of their shareholding, Perea Capital becomes the fifth largest shareholder in Regional Express Holdings Limited and the only non-Singapore-based individual or entity with a top five shareholding. Perea Capital did not respond to ch-aviation's request for comment.
