DUBLIN (Reuters) – Ryanair <RYA.I> launched a share placement on Thursday, aiming to raise 400 million euros ($473 million) to help it take advantage of lower costs following the COVID-19 pandemic to expand its fleet and other initiatives.
The Irish airline, Europe’s largest low-cost carrier, said the equity raise, via a “non-pre-emptive placing of new ordinary shares … to institutional investors and certain others” would begin immediately via an accelerated bookbuild.
Certain directors and members of the senior management team intend to participate in the placing including Group Chief Executive Michael O’Leary, who intends to subscribe broadly pro rata to his current shareholding, Ryanair said in its statement.
While the COVID-19 pandemic has hammered air travel, the airline said that it was also likely to “create opportunities for Ryanair to grow its network, and expand its fleet, to take advantage of lower airport and aircraft cost opportunities that are likely to arise.”
Ryanair flew just under half as many passengers in August than in the same month last year, but it has one of the strongest balance sheets in the industry with over 3.9 billion euros in cash as of June 30 and unencumbered Boeing 737 jets worth about 7 billion euros.
“The placing is expected to help better position the group to move quickly to capitalise on such opportunities should they arise… (and) should significantly de-risk the group’s debt repayments over the next 12 months,” the statement said.
Rival airline group IAG <ICAG.L>, which owns British Airways and Ireland’s Aer Lingus, in July announced plans to raise 2.75 billion euros from shareholders.
Irish stockbroker Davy is the sole bookrunner on the Ryanair placement.
($1 = 0.8455 euros)
(Reporting by Conor Humphries; Editing by Susan Fenton)