KUALA LUMPUR – AirAsia X Bhd will only raise RM166 million from its rights issue – a much smaller amount compared to the RM300 million it had planned for its restructuring exercise.
It was reported in The Malaysian Reserve that the carrier had yesterday fixed the price issue for its one-for-one rights issue and a special issue at 28 sen per share to raise a total of RM166 million.
The company expects to raise RM50 million for a special issue now.
The price is at a discount to its market share price of 60 sen at yesterday’s close.
The company has previously obtained shareholders’ approval for a larger rights issue to raise RM300 million and a special issue of RM200 million.
In its exchange filing, the company said that all approvals for the fundraising have been obtained.
AirAsia X CFO Andrew Littledale was quoted by The Malaysian Reserve as saying that the company had RM95 million in cash at the start of 2021, while its average monthly cash burn over the last 14 months was RM3 million.
“Even if borders are not open in the next few years, which will not be the case, we will be able to sit through any possibilities.
“A greater fundraising is not only unneeded at this time, but it will also be punitively dilutive, particularly for existing retail shareholders who may not be able to fund a larger rights issue during this tough time,” said Littledale in a release explaining the reduction in funds to be raised.
“We sharply narrowed our operating loss to RM12 million as we ramped up our cargo business post the successful restructuring vote by creditors in November last year.
“We expect to have seven planes fully operational by the end of this quarter with the current fleet of 11 wide-body A330’s all flying by the end of October 2022,” AirAsia X CEO Benyamin Ismail was quoted by The Malaysian Reserve.
He added that the carrier has been flying three planes in the quarter ended December 31.
“We have used the downtime in passenger flying to ramp up cargo revenue and will continue to further build on it,” he added.
The company said it had solidified strategic cargo relationships with Teleport and Geodis in this quarter and are in various stages of discussions with more global logistics providers to support the implementation of its combination carrier strategy.
The strategy will focus on cargo as the primary revenue stream and passengers as a bonus.
The carrier is also in talks to lease at least four more planes as they prepare for a full resumption of passenger flights when borders open, taking its fleet size to at least 15 A330s. – The Vibes, February 22, 2022
