Air France-KLM has completed a share capital increase raising approximately EUR2.256 billion (USD2.35 billion) (of which EUR1.611 billion (USD1.68 billion) was in cash) following the issuance of 1.928 billion new shares with a par value of EUR1 (USD1.04) at a subscription price of EUR1.17 (USD1.22) per share.
According to a stock market release, the Air France/KLM Royal Dutch Airlines parent's shareholding structure has been revised as follows:
% of the capital post Right Issue vs Pre-issuance
- French State: - 28.6% vs 28.6%;
- Dutch State - 9.3% vs 9.3%;
- CMA CGM - 9.0% vs 0.0%;
- China Eastern Airlines (MU, Shanghai Hongqiao) - 4.7% vs 9.6%;
- Delta Air Lines (DL, Atlanta Hartsfield Jackson) - 2.9% vs 5.8%;
- Treasury stock - 0.05% vs 0.2%;
- Others - 45.5% vs 46.5%.
In terms of voting rights, the French and Dutch governments' positions have changed with the former controlling 28.5% (vs 28.1% pre-issuance) and the latter with 10.7% (vs 13.8%). China Eastern Airlines and Delta Air Lines participated in the issue on a cash-neutral basis, for an aggregate amount of approximately EUR110.7 million (USD115 million) by subscribing to 58,763,343 and 35,873,772 new shares respectively by using the net proceeds from selling part of their rights to CMA CGM. The French logistics giant now holds 8.3% while China Eastern's voting rights have declined to 5.6% from 11.4% previously. Delta's voice has also deminished to 4% from 8.6%.
The Franco-Dutch holding will use part of the net proceeds of the issue to repay its deeply subordinated bonds issued in April 2021 and held by the French state as well as to shore up its equity.
"As announced during its full-year results presentation on February 17, 2022, the Company intends to free itself from the conditions set by the European Commission’s Covid-19 temporary framework and will therefore allocate about EUR1.7 billion (USD1.75 billion) to the repayment of the 'Covid-19 recapitalization aid' granted in the form of undated subordinated notes (the "TSS État") issued in April 2021, through offset and repayment. The remainder (about EUR600 million (USD635 million) will come to reduce net debt," it said.
Air France-KLM aims to its reduce its net debt / EBITDA ratio to between 200-250% by 2023.
