21.04.2021 - 01:58 UTC
Air France-KLM may seek new fundraising measures in the coming months to reduce its debt and strengthen its balance sheet, its chief executive Ben Smith said during an online industry event on April 19.
He spoke on the same day that the group announced the “success” of its recent share issue, which raised EUR1.036 billion euros (USD1.25 billion) and shifted the shareholdings in the company. The French government more than doubled its stake to 28.6% and China Eastern Airlines (MU, Shanghai Hongqiao) raised its ownership from 8.8% to 9.6%, while the issue diluted the Dutch government’s equity stake to 9.3% and that of Delta Air Lines (DL, Atlanta Hartsfield Jackson) declined to 5.8%.
“We have a heavy debt burden that is holding back our balance sheet, so this should be reviewed later this year,” Smith said, as quoted by Bourse Direct. “If and when there is a good time to do it, I am not in a position today to confirm any date.”
Smith said he thought the share issue went well,...
07.04.2021 - 12:15 UTC
As anticipated, the European Commission has approved a second bailout of Air France-KLM, involving EUR4 billion euros (USD4.75 billion) in refinancing that could see the French state increase its stake in the group from 14.3% to almost 30%.
Under the plan, which so far benefits only the Air France (AF, Paris CDG) wing of the group, the French government will convert a EUR3 billion (USD3.56 billion) loan provided last year into a perpetual hybrid bond and take part in a planned EUR1 billion (USD1.19 billion) share issue, thereby raising its shareholding.
The measures have “the objective of strengthening the group’s balance sheet, preparing the recovery, and repositioning it on a sustainable financial trajectory,” the company said in a statement.
French Finance Minister Bruno Le Maire later confirmed on France Inter public radio that the move “will make the state Air France’s biggest shareholder,” a development he described as a “sign of commitment” to the airline and its staff.
The aid “will come with strings attached, in particular, to ensure the French state is...
