(Adds detail, background)
LONDON, Sept 10 (Reuters) - British Airways owner IAG
launched a heavily discounted rights issue on Thursday
to raise 2.74 billion euros ($3.2 billion) to help strengthen
its finances, which have been squeezed by the coronavirus
pandemic.
Under the terms of the fully underwritten capital increase,
announced in July and approved by shareholders on Tuesday,
shareholders can subscribe to three new shares for every two
they own.
IAG said it will issue 2.97 billion new shares at 0.92
euros, representing a 36% discount to the theoretical ex-rights
price based on the closing price on Wednesday.
The group's largest shareholder, Qatar Airways Group, which
has a 25.1% holding, has undertaken to subscribe for its
pro-rata entitlement.
IAG, which also owns Iberia, Aer Lingus and Vueling
airlines, is launching the rights issue under new chief
executive Luis Gallego, the Spanish insider who replaced
long-time boss Willie Walsh on Tuesday.
Like all airlines, IAG is struggling to recover from the
pandemic and capacity in Europe is still less than half of last
year's. An uneven patchwork of travel restrictions and
quarantine rules across Europe continues to hurt the industry.
IAG said the capital increase would reduce debt on its
balance sheet and help it withstand a prolonged downturn in
travel.
($1 = 0.8453 euros)
(Reporting by Sarah Young; Editing by Jason Neely and Jan
Harvey)
International Airlines (IAG)
