KUALA LUMPUR: AirAsia Group Bhd has announced a fresh RM1bil capital raising plan, as the budget carrier targets to resume at least 35% of its flights from pre-Covid-19 capacity by the end of the year.
AirAsia, in a filing with Bursa Malaysia today, has proposed a renounceable rights issue of up to RM1.02bil in 7-year redeemable convertible unsecured Islamic debt securities (RCUIDS).
The RCUIDS will be issued on the basis of two RCUIDS with one free detachable warrant for every six ordinary AiAsia shares.
About RM380mil has been set aside to pay for the group’s fuel hedging settlement and aircraft leases, while RM122mil was allocated for its digital business.
A total of RM508mil has been earmarked for working capital purposes.
“The Proposed Rights Issue will enable the Company to raise funds to provide the Group with sufficient funding to ride through the current challenging environment and meet the Group’s funding requirements,” AirAsia said.
The group has projected to raise between RM615.9mil and RM1.02bil under the minimum subscription level and full subscription level respectively.
The fund raising exercise, AirAsia said, will also “enhance the Group’s financial position with an increase in the net assets and improvement in the gearing of the Group.”
“Overall, in line with expected timeline of the vaccinations and the gradual ramp-up in demand for air travel, the Group will continue to exercise its active capacity management strategy and is targeting to operate approximately 35-45% of its 2019 pre-Covid 19 capacity by the end of 2021, with thereafter the corresponding ramp-up in its flight schedule to normalcy,” it said.
AirAsia said it will continue to assess the potential of increasing more flights and adding destinations for its customers in the coming months, subject to government health measures.