Kenya Airways prices rights issue

Victoria
By Victoria March 12, 2012 15:20

Kenya Airways prices rights issue

Kenya Airways has priced its $250 million cash call at 14 shillings ($0.17) per share, a 32% discount to the shares’ average price over the last three months, it said today.
The airline, which is 26% owned by AirFrance KLM , wants to buy new aircraft with funds raised from the rights issue, in line with its plans to double its fleet in the next five years and a longer-term 10-year expansion drive. Chief executive Titus Naikuini said the airline, one of Africa’s leading carriers, wanted to add 73 wide and narrow-bodied aircraft to its current fleet of 34, as well as introduce 60 new routes over 10 years.”The plan is to expand in Africa and the Far East,” he told a news conference,
The issue was announced last year and will lead to the creation of 1.48 billion shares to be offered at a rate of 16 for every five held. It has already been 50% subscribed after both AirFrance KLM and the Kenyan government, which has a 23% stake, committed to take up their rights.
The Kenyan central bank raised rates sharply in the last quarter of 2011 to fight inflation and curb exchange rate volatility and this increase may hamper efforts to get the rights issue off of the ground. Some 20% needs to be allocated for the rights issue to go ahead.
The issue is being led by CFC Stanbic as transaction adviser and Standard Investment Bank as the lead sponsoring broker.

Victoria
By Victoria March 12, 2012 15:20
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