Kuala Lumpur, Malaysia (4E) – AirAsia X Bhd., the long-haul unit of Malaysian budget carrier AirAsia, seeks to raise up to $ 370mn through an initial public offering (IPO) in the Kuala Lumpur stock exchange to fund its expansion plans amid rising demand for travel.
AirAsia X has began taking orders on Monday for its IPO, based on the term sheet obtained by the Dow Jones Newswires. The prospectus also states that the airline is offering 14.4 per cent of its share capital to institutional investors and 10.6 per cent to individual investors.
AirAsia X seeks to sell 790.1 million shares, which excludes an overallotment option, with a price range of 1.15 ringgit to 1.45 ringgit ($ 0.37 to $ 0.47) a share, according to the term sheet.
Proceeds from the stock offering will be used to pay down debt and help build new hubs. Chief Executive Azran Osman-Rani said he is keen in expanding to fend off competition from Scoot, the long-distance budget division of Singapore Airlines Ltd. that began commercial flight operations last year.
Travel demand has benefited from the economic growth in Asia, which resulted to the launching of 15 budget airlines in the past decade.
The move is the second of the three planned listings by AirAsia’s affiliates. The group will finalize its IPO price on June 24, before its scheduled listing date on July 10.
There are no comments yet. Why not be the first to speak your mind.