Etihad Airways has increased the amount of cash it raised with its first joint bond issue by 40 per cent after it restarted fundraising.
The Abu Dhabi flag carrier and six partners said they had raised an extra US$200 million from their first joint bond issue after reaching an initial target of $500m on Tuesday, taking the size of the issue to $700m.
Etihad, Etihad Airport Services, airberlin, Air Serbia, Air Seychelles, Alitalia and Jet Airways reopened the fundraising, reacting to what they described as “unprecedented increased demand from financial institutions in a range of markets”.
Fundraising for the bond was reopened by Goldman Sachs, ADS Securities and Anoa Capital. They used a financial instrument known as a tap, which enables an existing transaction to reopen for subscription using the same documentation as before.
According to Reuters, price guidance for the issue was set at 6.875 per cent, the same coupon as the bond issue that closed on Tuesday.
“The additional demand we have seen over the past 24 hours has been enough for us to reopen the transaction,” said James Hogan, Etihad’s president and chief executive. “These additional funds will allow this group of airlines to accelerate further the realisation of this vision and these strategies.”
Etihad said the funds would be split across the seven businesses and used for a mix of investment in new aircraft, upgrading existing assets and refinancing debt.
Etihad, Etihad Airport Services, airberlin and Alitalia will each receive nearly a fifth of the funds, 16 per cent goes to Jet and the remainder will go to Air Serbia and Air Seychelles.
lbarnard@thenational.ae
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