(Reuters) – Russia's largest air carrier Aeroflot plans to raise at least 80 billion rubles for recovery from the crisis and development through the sale of additional shares to the state and on the Moscow Stock Exchange, the company said on Friday.
Earlier, Reuters sources said that Aeroflot expects to attract 80 billion rubles through an additional issue, including about 50 billion rubles from the state and from other investors, including VTB (MCX: VTBR) and the Russian Direct Investment Fund (RDIF).
“The additional capital … will give us the support we need to recover from the crisis, as well as for further development in the future,” the company's CEO Vitaly Savelyev said in a statement. “The Russian air passenger market provides significant opportunities for long-term structural growth.”
Russia, like other countries, completely closed international air traffic from April to July due to the coronavirus, and domestic traffic was sharply reduced due to quarantine measures, which brought huge losses to airlines. In the second quarter, Aeroflot (MCX: AFLT) lost more than revenue, reaching 35.8 billion rubles.
Acceptance of applications for the exercise of the preemptive right ended on Thursday, and meetings with investors began on Friday, the company said.
As part of the preemptive right, the company received applications from shareholders for the purchase of 986,997,411 shares, the company said, including for 869,940,480 – from the state, that is, 88% of the total volume of applications under the preemptive right.
Shareholders who submitted the bids will be able to refuse to purchase shares under the preemptive right after the price announcement without paying for them, Aeroflot reported.
The state, which now owns 51.17% of Aeroflot's shares, plans at least not to reduce its share and may buy both shares under preemptive rights and under the SPO, the statement said.
At the second stage of the deal, which began on Friday, the company will offer investors the second part of an additional issue out of the total volume of 1.7 billion shares approved by the board of directors, for a total of about 39 billion rubles.
The book is slated to close on Oct. 8, sources told Reuters.
(Gleb Stolyarov, Olga Popova. Edited by Anastasia Teterevleva)