AIRLINK 74.64 Decreased By ▼ -0.21 (-0.28%)
BOP 5.01 Increased By ▲ 0.03 (0.6%)
CNERGY 4.51 Increased By ▲ 0.02 (0.45%)
DFML 42.44 Increased By ▲ 2.44 (6.1%)
DGKC 87.02 Increased By ▲ 0.67 (0.78%)
FCCL 21.58 Increased By ▲ 0.22 (1.03%)
FFBL 33.54 Decreased By ▼ -0.31 (-0.92%)
FFL 9.66 Decreased By ▼ -0.06 (-0.62%)
GGL 10.43 Decreased By ▼ -0.02 (-0.19%)
HBL 114.29 Increased By ▲ 1.55 (1.37%)
HUBC 139.94 Increased By ▲ 2.50 (1.82%)
HUMNL 12.25 Increased By ▲ 0.83 (7.27%)
KEL 5.21 Decreased By ▼ -0.07 (-1.33%)
KOSM 4.50 Decreased By ▼ -0.13 (-2.81%)
MLCF 38.09 Increased By ▲ 0.29 (0.77%)
OGDC 139.16 Decreased By ▼ -0.34 (-0.24%)
PAEL 25.87 Increased By ▲ 0.26 (1.02%)
PIAA 22.20 Increased By ▲ 1.52 (7.35%)
PIBTL 6.80 No Change ▼ 0.00 (0%)
PPL 123.58 Increased By ▲ 1.38 (1.13%)
PRL 26.81 Increased By ▲ 0.23 (0.87%)
PTC 14.01 Decreased By ▼ -0.04 (-0.28%)
SEARL 58.53 Decreased By ▼ -0.45 (-0.76%)
SNGP 68.01 Decreased By ▼ -0.94 (-1.36%)
SSGC 10.47 Increased By ▲ 0.17 (1.65%)
TELE 8.39 Increased By ▲ 0.01 (0.12%)
TPLP 11.05 Decreased By ▼ -0.01 (-0.09%)
TRG 63.21 Decreased By ▼ -0.98 (-1.53%)
UNITY 26.59 Increased By ▲ 0.04 (0.15%)
WTL 1.42 Decreased By ▼ -0.03 (-2.07%)
BR100 7,941 Increased By 103.5 (1.32%)
BR30 25,648 Increased By 196 (0.77%)
KSE100 75,983 Increased By 868.6 (1.16%)
KSE30 24,445 Increased By 330.8 (1.37%)
Business & Finance

Air France-KLM eyes further recapitalisation in 2021

  • We do have heavy debt that is holding back our balance sheet, so this may have to get looked at again later in the year.
  • The capital hike sees the French government more than double its stake in the airline group to almost 30% as part of a total recapitalisation package worth about 4 billion euros announced earlier this month.
Published April 19, 2021

PARIS: Air France-KLM may raise additional capital to bolster its balance sheet as travel begins to recover from the COVID-19 pandemic in coming months, Chief Executive Ben Smith said.

Smith, speaking at an online industry event on Monday as a 1 billion euro ($1.2 billion) share issue by the airline group nears completion, signalled that it could move relatively quickly to seek more funds and reduce debt.

"We do have heavy debt that is holding back our balance sheet, so this may have to get looked at again later in the year," he said, adding that Air France-KLM was encouraged by European progress on vaccinations and digital health passes.

The capital hike sees the French government more than double its stake in the airline group to almost 30% as part of a total recapitalisation package worth about 4 billion euros announced earlier this month.

The stock issue at 4.84 euros per share will raise between 900 million and 1.04 billion euros, depending on the exercise of an increase option.

It follows last year's 10.4 billion-euro debt bailout for the airline group, backed by the French and Dutch governments.

"This is positive for them in terms of getting through these difficult times but negative in that it's giving them enormous debts for the future and potential political interference," aviation consultant John Strickland said at the same event.

As part of the latest package, France is transforming 3 billion euros of government loans into hybrid bond instruments, while the Netherlands seeks EU approval for the similar conversion of another 1 billion. The new share issue dilutes the Dutch government's equity stake to about 9.3%.

Air France-KLM currently plans at least to match the 50% of pre-crisis summer flight capacity it maintained last year and is optimistic about a sharper rebound, Smith also said.

"We're loading capacity on an opportunistic basis," the CEO added. "We do have enough crew trained and qualified to fly much more."

Comments

Comments are closed.