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LONDON, Sept 9 (Reuters) - British airline easyJet
said it had rejected a takeover offer on Thursday and would
raise $1.7 billion from shareholders to fund its pandemic
recovery and expand operations.
The company said the all-share approach fundamentally
undervalued the business. It said the potential bidder had since
stated that it was no longer interested in a deal.
EasyJet said it would use the rights issue to strengthen its
balance sheet and also to take advantage of growth opportunities
that arise from the expected recovery in Europe's aviation
market over the coming years.
It wants to steal market share from legacy carriers like
British Airways-owner IAG, once a rumoured suitor of
easyJet, and Air France-KLM as they restructure their
short-haul operations.
Chief Executive Johan Lundgren said the capital raise would
enable the airline to accelerate its post-COVID-19 recovery plan
and position it to take advantage of strategic investment
opportunities, such as expanding its presence at key airports by
buying more landing slots.
"This capital increase will allow us to build on our
fundamental operational strengths and network strategy for our
customers as well as accelerate long-term value creation for our
shareholders," he said.
Under the rights issue, shareholders will be able to buy 31
new shares for every 47 existing shares at a price of 410 pence
each, a 35.8% discount on the theoretical ex-rights price of 638
pence per share on Sept. 8, easyJet said.
The rights issue is underwritten by BNP Paribas, Credit
Suisse, Goldman Sachs, Santander and Societe Generale.
It also announced a new committed $400 million secured
revolving credit facility.
($1 = 0.7264 pounds)
(Reporting by Sarah Young and Paul Sandle; Editing by Kate
Holton)
