WOW air (Reykjavik Keflavik) is planning to issue SEK0.5-1 billion krona (USD54.5-109 million) worth of bonds to refinance debt and cover immediate financial needs ahead of an Initial Public Offering planned within the next 18 months, Morgunblaðið has reported.

According to a prospectus seen by the Icelandic newspaper, the bond issuance, led by Norwegian bank Pareto Securities, is expected to take place by the end of August 2018.

The new bonds will allow WOW air to cover its operational losses which, between July 2017 and June 2018, amounted to around USD45 million. Projections for 2018 show the Icelandic LCC expects to lose USD28 million on an EBIT level.

By raising new capital through bond sales, WOW air will not have to dilute its ownership. The airline is currently privately owned by its founder and CEO, Skuli Mogensen.

WOW air has not yet said whether it will list on the Icelandic stock exchange or choose another bourse. It currently has a heavy exposure to both the United Kingdom and the United States, its two largest foreign markets.