Jeju Air Co.’s biggest and second biggest shareholders AK Holdings Inc. and the Jeju Special Self-Governing provincial government joined recapitalization scheme and took up 90.1 percent of rights offering to help the top budget carrier endure the headwinds from coronavirus.

Jeju Air announced Friday that 135 billion won ($133.8 million) worth new shares were allocated to its existing shareholders and employee union out of total 150 billion won offering at 12,400 won apiece.

On Friday, Jeju Air shares fell 0.32 percent to end at 15,500 won.

The Jeju government subscribed about 4 billion won worth new shares, smaller than its original plan to secure 8 billion won worth shares due to the financial problem caused by COVID-19. The remaining was subscribed by AK Holdings.

The forfeited 12 million shares will become available to the general public on August 18-19.

The proceeds will be spent on repaying debt and improving financial health amid industry-wide crisis caused by coronavirus, Jeju Air said.

“The proceeds will help us stabilize management better than competitors,” according to an official from the company. “We will work hard to maintain our position as a leading low-cost carrier in the post-COVID 19 era.”

By Choi Mira

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