skyvan
11th Apr 2006, 18:26
From FIN24
Cape Town - A new look SunAir, now controlled by Atlas Discovery Holdings, wants to take to the skies between August and September again - this time as an international carrier.
SunAir has twice (once in 1999 and again in 2004) plunged into liquidation. It seems the new owners, and CEO Owen Wienand, believe it will be third time lucky for the airline.
To international commuters having an international airline based in Cape Town seems almost too good to be true.
So what's the catch? The airline is looking for investors willing to pump in $125m to fund operations that will kick off initially with international flights between Cape Town and London.
Listing in late 2005
Prospective investors are being told that SunAir International envisages a listing in the third or fourth quarter of 2005.
The previous SunAir operation was owned by listed Million Air (now delisted) before control was sold to a private investor only months before its second liquidation.
Share placement agent Richard Albert told Fin24 the share offers were being well received, and that company was confident of raising $125m (R750m) needed to get the airline off the ground.
Albert points out that what differentiated the new Sun Air for the old operation was the Cape Town-based focus on overseas flights as well as a broader operational sphere - including ground handling, an air training academy, leasing and maintenance operations.
He said there was general interest in the offer from institutional and private investors alike.
Not exactly enamoured
Market watchers canvassed by Fin24 were not exactly enamoured with the SunAir offer, most believing the group would battle to raise the envisaged funding.
Judging by the e-mail share pitches currently doing the rounds, it seems obvious SunAir International is trying to tap individual investors.
To put the SunAir share offer in perspective, it is worth noting that the R750m required in funding is larger than the current market capitalisation of listed domestic airline Comair.
An investor's brochure shows revenue of $70m (R420m) in year one of operation with a net loss of $14.4m. Year two forecasts show revenue growing to $156m and net profit of $22.6m.
Regarding competition with national carrier SAA, the SunAir directors have adopted a diplomatic approach.
They note a strategic objective to "forge and maintain" a strong alliance with SAA.
"We will negotiate with them to the extent they are comfortable that we have no intention to oppose them, but are seen as adding value to the national carrier."
(read more on SunAir International in next week's Finweek).
Cape Town - A new look SunAir, now controlled by Atlas Discovery Holdings, wants to take to the skies between August and September again - this time as an international carrier.
SunAir has twice (once in 1999 and again in 2004) plunged into liquidation. It seems the new owners, and CEO Owen Wienand, believe it will be third time lucky for the airline.
To international commuters having an international airline based in Cape Town seems almost too good to be true.
So what's the catch? The airline is looking for investors willing to pump in $125m to fund operations that will kick off initially with international flights between Cape Town and London.
Listing in late 2005
Prospective investors are being told that SunAir International envisages a listing in the third or fourth quarter of 2005.
The previous SunAir operation was owned by listed Million Air (now delisted) before control was sold to a private investor only months before its second liquidation.
Share placement agent Richard Albert told Fin24 the share offers were being well received, and that company was confident of raising $125m (R750m) needed to get the airline off the ground.
Albert points out that what differentiated the new Sun Air for the old operation was the Cape Town-based focus on overseas flights as well as a broader operational sphere - including ground handling, an air training academy, leasing and maintenance operations.
He said there was general interest in the offer from institutional and private investors alike.
Not exactly enamoured
Market watchers canvassed by Fin24 were not exactly enamoured with the SunAir offer, most believing the group would battle to raise the envisaged funding.
Judging by the e-mail share pitches currently doing the rounds, it seems obvious SunAir International is trying to tap individual investors.
To put the SunAir share offer in perspective, it is worth noting that the R750m required in funding is larger than the current market capitalisation of listed domestic airline Comair.
An investor's brochure shows revenue of $70m (R420m) in year one of operation with a net loss of $14.4m. Year two forecasts show revenue growing to $156m and net profit of $22.6m.
Regarding competition with national carrier SAA, the SunAir directors have adopted a diplomatic approach.
They note a strategic objective to "forge and maintain" a strong alliance with SAA.
"We will negotiate with them to the extent they are comfortable that we have no intention to oppose them, but are seen as adding value to the national carrier."
(read more on SunAir International in next week's Finweek).