LONDON (Alliance News) - Low-cost African airline Fastjet PLC on Thursday said it raised GBP19.2 million via a placing and open offer, with the latter at a significant premium.
Fastjet said it raised GBP15.0 million via the placing, conducted via an accelerated bookbuild by investment bank Liberum Capital Ltd. In addition it will raise GBP4.2 million via an open offer.
Executive Chairman Colin Child agreed to subscribe for 140,000 shares at the issue price as part of the placing, his only holding in the company.
The shares were placed at 50.00 pence per share, a significant premium to the company's closing price of 23.13p on Wednesday. Shares in Fastjet closed up 43% to 33.00p after the news.
The funds will be used for working capital purposes and to back Fastjet's revised business plan, which includes the introduction of a new type of aircraft to its fleet and the relocation of its head office in the UK to Africa.
Fastjet said despite the ongoing cost reduction programme at the company, plus a recent reduction in routes and fleet size, the company continues to be cash flow negative. The funds raised will therefore provide essential working capital for Fastjet to pursue its strategy.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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