Air France-KLM Launches $1.18 Billion Capital Increase with French Government Backing -- Update
By Olivia Bugault
--Air France-KLM launches $1.18 billion capital increase for
--The French state will participate for a maximum amount of
--China Eastern Airlines is also subscribing to the capital
Air France-KLM said late Monday that it has launched a planned
capital increase of around 988 million euros ($1.18 billion) and
that the net proceeds will be used to strengthen the balance sheet
and liquidity of its French arm.
The Franco-Dutch carrier said it will issue 186 million new
shares at a price of between EUR4.84 and EUR5.31 a share, and that
the capital raise for Air France could be up to EUR1.14 billion in
the event that the increase option is exercised in full.
The French state --which holds a 14.3% stake in Air France-KLM--
will subscribe for up to 65.9% of the capital increase, or up to
EUR650.8 million, and won't hold more than 29.9% of the company's
share capital once the capital increase is completed, the airline
said. China Eastern Airlines, which holds a 8.8% stake in the
airline, will participate to the capital increase but will keep its
stake under 10%, it said.
"The subscription commitments total approximately EUR777.9
million and represent approximately 78.7% of the amount of the
capital increase," it said.
The Dutch state won't participate in the capital increase.
The launch comes after EUR4 billion in state aid to recapitalize
Air France was approved by the European Commission last week that
also includes the conversion of a EUR3 billion French state loan
into a perpetual hybrid bonds instrument.
In a separate statement late Monday, Air France-KLM said it was
strengthening its collaboration with China Eastern Airlines. The
airlines will expand their commercial collaboration and increase
their operations between Beijing and Europe through their joint
venture, it said.
Write to Olivia Bugault at firstname.lastname@example.org
(END) Dow Jones Newswires
April 13, 2021 02:53 ET (06:53 GMT)
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