Webjet to raise $163 million in convertible notes.
Webjet has just announced a 100 million Euro (A$163 million) convertible notes offering on the Singapore Stock Exchange, to “support our ongoing focus on maintaining a strong balance sheet as we continue to navigate the challenging operating environment caused by COVID-19”.
CEO John Gucsic said the move would increase Webjet’s financial and strategic flexibility, adding the strength of the company’s capital position would provide a “strategic advantage longer term, enabling the company to execute its strategy and take advantage of opportunities as they arise”.
The company has also provided an update on its operations, noting that total revenue in April and May 2020 was “nominal” while it continued to incur about $15 million per month in costs.
“While the Company has started to see some booking activity in its Australian OTA and WebBeds businesses, the Company anticipates that any revenue contribution in the near term will be modest only, until the situation improves and broad-based travel activity resumes,” Gucsic said.
He added that the previously announced suspension of Webjet Exclusives and the closure of the Online Republic Cruise business units would see the write-off of goodwill worth at least $18 million, and incur additional non-cash wind-up costs of at least $11 million.
Settlement of the notes offering is expected on or about 09 July 2020.
More details in tomorrow’s issue of Travel Daily.