Ryanair (FR, Dublin International) launched and sold an EUR850 million euro (USD1 billion) bond on September 7, which was more than five times oversubscribed, and also raised EUR400 million (USD470 million) in a share placement on September 3, shoring up the company's balance sheet.

This was its first euro-bond sale since 2017, and the fact that investors put in EUR4.4 billion (USD5.2 billion) worth of orders for it was a sign that debt markets in Europe are starting to reopen to airlines, according to Reuters.

It was the second bond issue by a European airline since the coronavirus pandemic wreaked havoc on passenger travel. As previously reported, Finnair (AY, Helsinki Vantaa) issued a hybrid bond on August 27.

Ryanair’s earlier share placement was via a “non-pre-emptive placing of new ordinary shares [...] in the capital of the company to institutional investors and certain others,” the airline said in a stock exchange filing the day after the placing.

A total of 35,242,291 new ordinary shares were placed, raising gross proceeds at just over the EUR400 million mark. These shares represent around 3.2% of the company’s issued share capital before the placing.

“Certain directors and members of the senior management team” also participated in the placement, buying 1,444,101 new shares at the placing price, Ryanair said in its statement.

The airline said that the money raised was likely to “create opportunities for Ryanair to grow its network, and expand its fleet, to take advantage of lower airport and aircraft cost opportunities that are likely to arise.”

It added that the placing “is expected to help better position the group to move quickly to capitalise on such opportunities should they arise [and] should significantly de-risk the group’s debt repayments over the next 12 months.”

Ryanair said it had more than EUR3.9 billion (USD4.6 billion) in cash as of June 30 and unencumbered B737 aircraft worth about EUR7 billion (USD8.25 billion). The Ryanair fleet currently consists of 440 B737-800s, 258 of which are owned, plus a single owned B737-700, the ch-aviation fleets module shows.

However, on September 8, Ryanair informed its employees in Cork and Shannon that it intends to close both bases for the winter and possibly beyond that, unless the Irish government relaxes its quarantine rules for inbound passengers, RTÉ news reported.

Closures would affect the 95 cabin crew and 35 pilots the carrier directly employs at the airports as well as staff employed by other firms contracted to Ryanair. All pilots and crew would be placed on unpaid leave from the end of October. Flights to Shannon and Cork would continue at reduced frequencies from bases elsewhere.

Eddie Wilson, chief executive of subsidiary Ryanair Designated Activity Company (DAC), said in the letter that the decision could be reversed if restrictions, which force passengers from most countries to quarantine for a fortnight, are updated.

Meanwhile, investment advisor Institutional Shareholder Services has urged shareholders to oppose a proposed EUR458,000 (USD539,000) annual bonus for Ryanair CEO Michael O’Leary, set for a non-binding vote on September 17, the Financial Times reported. It argued that the award for the financial year ending March 31 is hard to justify amid the current crisis.

The advisor had previously recommended against British Airways owner IAG International Airlines Group giving retiring CEO Willie Walsh a GBP883,000 pound (USD1.14 million) send-off. In a non-binding vote at an IAG meeting on September 8, nearly 30% of IAG shareholders failed to back the bonus.