The board of directors of Aeroflot (SU, Moscow Sheremetyevo) has approved an additional issue of up to 5.4 billion shares at a price of RUB34.29 rubles (USD0.52) per share, the company outlined in a statement released on May 4.
The board relayed that at a meeting held on April 29 it had passed plans it had previously revealed to conduct the state-approved issue, which will increase its charter capital “as part of a set of measures aimed at improving the financial stability of Aeroflot Group and restructuring debt under letters of credit.”
The company will amend its articles of association to increase the number of authorised shares to 5,424,308,073, subject to the support of shareholders at a meeting scheduled for June 3. The shareholders “were recommended to approve the proposed amendments.” The Russian state’s stake in the group, which also includes Pobeda (DP, Moscow Sheremetyevo) and Rossiya (FV, St. Petersburg), currently stands at 57.34%, while the remainder is listed on Russia’s Moscow Exchange.
Aeroflot’s share price has slumped since the week preceding Russia’s invasion of Ukraine, from RUB60.50 (USD0.92) on February 16 to RUB31.20 (USD0.48) on May 5. The figure of RUB34.29 per share is based on the report of an independent appraiser, Aeroflot said, but it did not specify who conducted the assessment.
Forbes Russia cited reports that Aeroflot could attract around RUB186 billion (USD2.85 billion) through the measure. The volume of the issue at full placement corresponds to the dilution of the company's capital by 3.2 times, but the actual volume may be lower as a large number of the new securities will be bought by the state, sources told the news site.
