ANA mulls $1.9B IPO over air travel slump
JAPAN’S ANA Holdings Inc is considering making a public offering of 200 billion yen ($1.9 billion) in shares in preparation for an expected prolonged slump in air travel, sources have said.
In addition, the parent company of All Nippon Airways is believed to be seeking 400 billion yen in subordinated loans from banks as its financial performance has been worsening due to the spread of the novel coronavirus.
The holdings company posted a net loss of 108.8 billion yen in its consolidated financial results in the AprilJune period this year.
Burning through about 60 billion yen a month due to labour and aircraft maintenance costs, the firm has been in talks with financial institutions, including the government-backed Development Bank of Japan Inc, MUFG Bank Ltd, Sumitomo Mitsui Banking Corp and Mizuho Bank Ltd, to raise about 500 billion yen in funding.
ANA Holdings concluded that it is necessary to raise funds through the public offering as financial support from the banks alone is not enough, the sources have said.
The group has cut bonuses and implemented furloughs for about 43,000 employees.
The company has also indicated a policy of structural reform that includes securing earnings from sources other than its passenger business.
It is believed that the company is seeking to further reduce costs and sell off assets amid the lingering weakness in demand for air travel.