Thai AirAsia IPO gets underway

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Thai AirAsia’s initial public offering (IPO) got underway today (23 May).

The Bangkok-based low-cost carrier has priced its shares at THB3.70 (US$0.12) each. With 1,212.5 million shares on offer, the company is hoping to raise approximately US$143.2 million.

Thai AirAsia and its underwriters launched the IPO in Bangkok
Thai AirAsia and its underwriters launched the IPO in Bangkok

The airline’s CEO, Tassapon Bijleveld, said the company plans to use part of the IPO proceeds to double its fleet of Airbus A320s to 48 aircraft within the next five years. The remainder of the IPO proceeds will be used for the purchase of newly-issued shares and to boost the airline’s working capital.

“Thai AirAsia aims to be the low-cost airline with the largest market share. Our strength is our cost control, which makes us the airline with the lowest operating cost while the service quality remains intact,” said Bijleveld.

“Today, we are ready to offer our shares to the public and will be listed on the Stock Exchange of Thailand. This is another crucial step that will stabilise Thai AirAsia’s financial status and allow the company to march forward to its planned goal. We aim to grow at least 20-25% from 2011, which will be supported by our new fleet, new route plans and flight frequency increase on potential routes,” he added.

Ms Suvabha Charoenying, Managing Director of Thanachart Securities, the deal’s financial advisor, revealed that the IPO has already drawn a strong response from local and overseas investors.

“The IPO price of THB3.70 per share is appropriate. The demand following the book-building among the institutional investors in local and overseas markets was 10 times oversubscribed. This reflects their strong interest,” Ms Suvabha said.

Of the 1,212.5 million shares offered, 750 million are new shares and 462.5 million shares are from existing shareholders. The subscription period for the IPO is 23-25 May 2012.

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