1 min read.Updated: 17 Sep 2015, 01:29 AM ISTP.R. Sanjai
20% each to Etihad Airways, Etihad Airport Services, airberlin and Alitalia, 16% to Jet Airways, and rest to Air Serbia and Air Seychelles to be allocated
Mumbai: Etihad Airways PJSC, its airport services business and five of its equity partners, including India’s Jet Airways (India) Ltd, have raised $500 million from the international markets.
Allocation of the funds raised will be nearly 20% each to Etihad Airways, Etihad Airport Services, airberlin and Alitalia, 16% to Jet Airways, and the rest to Air Serbia and Air Seychelles.
As of March 2015, the total debt of Jet Airways was at ₹ 11,902.67 crore.
The funds raised will be used largely for capital expenditure and investment in fleet as well as for refinancing, depending on each individual airline’s needs, Etihad Airways said in a statement on Monday.
Naresh Goyal-controlled Jet Airways sold a 24% stake to Etihad Airways in November 2013.
In its statement, Etihad Airways said on Wednesday that it has successfully completed “an innovative new platform financing transaction", raising $500 million on the international markets, without divulging details.
The funds have been raised through a special purpose vehicle, EA Partners IBV, it said.
Goldman Sachs International, ADS Securities and Anoa Capital are acting as joint lead book-running managers for the offering.
Etihad Airways holds equity investments in airberlin, Air Serbia, Air Seychelles, Aer Lingus, Alitalia, Jet Airways, Virgin Australia, and Swiss-based Darwin Airline, trading as Etihad Regional.
“The transaction marks the first time that Etihad Airways and its partners have raised funds together. To date, Etihad Airways has already raised in excess of $11 billion from more than 80 financial institutions, to help fund its expansion strategy," the statement said.
“We have already been able to identify significant opportunities together, whether that be in shared IT platforms, joint fleet procurement or shared training costs. Commercial fund-raising is no different," said James Hogan, president and chief executive officer of Etihad Airways. “Our proposed transaction is simply the next logical step in our growing partnership and underpins its strategic importance."
At a series of roadshow meetings, held in Abu Dhabi, Dubai and London, the shared vision and strategies of the airlines were laid out to financial institutions, the airline said.
These highlighted the growing network coordination and revenue development initiatives, coupled with joint procurement and business synergy projects, across the airlines, Etihad said.
At the beginning of 2014-15, Jet Airways’ chief executive officer Cramer Ball had outlined a three-year turnaround plan to get back to profitability. The plan included various stand-alone measures and synergies with Etihad Airways.
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