AirAsia Group (AAGB) has released details of a restructuring and recapitalisation plan for Asia Aviation (AAV) and Thai AirAsia (TAA).
AAV proposes to inject THB3,900 million (approx. US$117.1 million) into Thai AirAsia by way of a new equity issuance, increasing AAV’s direct holdings in the company from 55.0% to 69.2% (which will reduce AirAsia Aviation’s (AAA) direct holdings in TAA to 30.8%).
The entire proceeds from the new equity issuance will be used by Thai AirAsia to repay part of the intercompany balances owed to AAGB and its subsidiaries. As of 30 June 2021, Thai AirAsia had outstanding trade debts with group companies of AAGB of approximately THB 4,182 million. Following the repayment, AAA will dispose of its 30.8% shareholding equivalent to 19,600,000 shares in TAA for THB3,800 million.
The accompanying proposed recapitalisation plan includes a AAV private placement for up to THB8,800 million (US$264.1 million) at a price of THB1.75 per share, and proposes new investors raise up to THB1,000 million (RM124.60 million).
Asia Aviation is also proposing a THB2,200 million convertible bond issue to two investors. Upon completion of the proposed private placement and the convertible bond issue, the company will then undertake a rights offering for up to THB3,000 million for a rights offer price of THB1.75 per share, that will be used to full funded via bank borrowings.
Full details of this hugely complex recapitalisation plan can be found here.