Pilots strike grounds 75 percent of Brussels Airlines flights

A departure flights board at Zaventem Airport in Brussels lists cancelled flights during a strike by pilots from Brussels Airlines. (AFP)
Updated 14 May 2018

Pilots strike grounds 75 percent of Brussels Airlines flights

BRUSSELS: Brussels Airlines pilots began a two-day strike Monday, leading to the cancelation of 75 percent of flights and affecting 60,000 travelers, the company said.
The strike will affect three-quarters of the 278 scheduled arriving and departing flights on Monday and 279 flights on Wednesday, the Lufthansa group subsidiary said.
The Belgium-based company, which was taken over by Lufthansa in late 2016, has asked its airline partners, which also include Swissair and Austrian Airlines, to increase capacity to Brussels to reduce the strike’s impact.
The company said last week that months of negotiations had failed to produce a deal after the two sides focused more on increased wages when in fact the pilots were more concerned about having a better work-life balance.
The airline management is due to discuss the strike later today.


Cathay Pacific shelves US dollar bond plans amid Hong Kong unrest

Updated 39 min 5 sec ago

Cathay Pacific shelves US dollar bond plans amid Hong Kong unrest

SINGAPORE: Cathay Pacific Airways has shelved plans for its first US dollar debt deal in 23 years, the airline said on Friday, after sources told Reuters that global investors had questioned the pricing due to civil unrest in Hong Kong.

The airline, the biggest corporate casualty of widespread anti-government protests in the Asian financial hub, on Friday lowered its second-half profit expectations, citing “incredibly challenging” conditions in its home market.

Cathay had started meeting investors in Hong Kong and Singapore on Sept. 24 after it mandated four banks to explore carrying out a US dollar denominated bond, according to a term sheet issued at the time, seen by Reuters.

It would have been the first US dollar debt deal for Cathay since 1996 and had been touted as a landmark transaction for the airline given all of its debt is denominated in Hong Kong dollars.

The issuance was to be unrated, and two sources with knowledge of the matter said that Cathay was willing to pay 200 basis points over the US Treasuries rate to secure three-year or five-year funding, with the size and term of the placement dependent on demand.

FASTFACT

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Cathay has only carried out 12 bond transactions in the past decade and all were priced in Hong Kong dollars.

However, investors demanded a higher price of at least 300 basis points over US Treasuries, which made the deal more expensive for Cathay, said the sources, who were not authorized to speak publicly about the matter. Cathay’s term sheet had said the transaction would be reliant on market conditions. A Cathay spokesman on Friday said the Hong Kong dollar private placement market was providing more funding opportunities and a debt issuance in that market was completed last month. “We will continue to monitor the US dollar bond market in future,” he said in a statement.

Dealogic data showed that Cathay raised $102 million in October and $64 million in May through Hong Kong dollar denominated deals.

The airline has only carried out 12 bond transactions in the past decade and all were priced in Hong Kong dollars.

Cathay had mandated Bank of America Merrill Lynch, BNP Paribas, Deutsche Bank and HSBC to work on the shelved US dollar bond deal.