SAS Scandinavia Airlines Boeing 737-700
SAS Scandinavian Airlines said it has received strong interest from investors in its issue earlier this month of approximately seven million preference shares with a value of SEK3.5 billion ($540 million).
“The demand has exceeded our expectations several times over and has resulted in significant oversubscription,” SAS CEO Rickard Gustafson said.
“The issue will provide the appropriate conditions for SAS to reach its financial targets ahead of what would otherwise have been the case, in addition to providing capital for the ongoing modernization of the aircraft fleet.”
One benefit of the successful issue is that the Scandinavian carrier can cancel a revolving credit facility that was created in fall 2012 when the airline was in financial instability.
In a second statement, SAS said it intended to issue SEK1.6 billion in guaranteed convertible bonds. These, together with the earlier preference share offer, would be used to redeem outstanding bonds due to mature in 2015, contribute to the purchase of new aircraft and reduce SAS’s dependence on bank financing.