And yet more proof (if proof were needed) that it's the low cost carriers that are reigning supreme at the moment - can anyone imagine BA, bmi or any other 'full service' carrier bleeding red ink everywhere trying a rights issue/placing at present?
From today's Scotsman
EasyJet to gain £93m from shares
Miriam Hils-Cosgrove
EUROPE’S second-largest budget airline, easyJet, has unveiled plans to price its shares at £3.75 each in a sale expected to net £93 million for the carrier and its founder, Stelios Haji-Ioannou.
The airline and Haji-Ioannou are cashing in on a recent rise in easyJet’s share price as no-frills carriers continue to outpace their increasingly troubled full-service rivals.
Even in the wake of the 11 September terrorist attacks on the US, easyJet and its low-cost competitor Ryanair have seen passenger numbers rise as they slashed fares to get travellers back in the air.
Haji-Ioannou stands to pocket at least £50 million from the complex sale of new and existing shares. The easyJet chairman is selling around a net 13 million shares in the airline, thereby cutting his stake from 36 per cent to 29 per cent.
The proceeds of the sale will be used to fund Haji-Ioannou’s other ventures, which include a car rental business and a chain of internet cafes.
Under the terms of the sale, easyJet has placed 6.5 million new shares and Haji-Ioannou’s holding company easyGroup has placed 32.53 million existing shares with institutional investors.
In turn, the company is making a three-for-40 rights offer to current shareholders of 19.53 million new shares at the same price of £3.75 per share, with easyGroup subscribing for 13.99 million shares, as well as underwriting the rest of the offer.
Ray Webster, chief executive of easyJet, said the offer, which closes on 20 November, was 4.5 times oversubscribed.
EasyJet shares rose 3 per cent to 394p in yesterday’s trading, their highest price since 11 September, before settling back to 385p. EasyJet has outperformed the FTSE transport sector by more than 50 per cent since the start of the year.
The budget airline, which has been hot on the heels of its more established long-haul competitors, said money raised from the share sale would help buy new planes and apply for more slots at airports, as it continues to expand in Europe.
Analysts said the deal was a canny way for Haji-Ioannou to bring in cash for his other business interests.
Founded in 1995, easyJet currently operates more than 30 routes in Europe from airport bases including London Luton, Geneva, and Amsterdam.