• Joe Breitfeller

Air Canada Closes Share and Convertible Note Offering, Raises Nearly C$1.6 Billion

Air Canada announced on Tuesday the closing of their previously announced share and convertible senior notes offering, raising gross proceeds of nearly C$1.6 billion. The underwritten public share offering included around 35.4 million shares at C$16.25 per share.


Air Canada Boeing 737 MAX 8 - Courtesy Air Canada

Today (June 2, 2020) Air Canada announced a bolstering of their liquidity position with the closing of a previously announced public share offering as well as convertible senior notes. The carrier raised a total of nearly C$1.6 billion, providing additional flexibility as the company navigates the global COVID-19 pandemic. Air Canada’s underwritten public offering consisted of 35,420,000 Class A Variable Voting Shares and/or Class B Voting Shares at C$ 16.25/share. The aggregate gross proceeds of the share offering are approximately C$575.6 million, which includes the full exercise of the underwriter’s over-allotment option to purchase 4.62 million shares. The private placement of convertible senior unsecured notes due 2025 resulted in aggregate gross proceeds of C$1.02 billion, including full exercise of the initial purchasers aver-allotment option. Air Canada will use the net proceeds of the transactions to supplement the carrier’s working capital and for general corporate purchases. In Tuesday’s announcement, Air Canada’s Deputy CEO and Chief Financial Officer, Michael Rousseau said,


Coming into 2020, Air Canada enjoyed a very strong liquidity position, before the COVID-19 pandemic and government-imposed quarantines and border restrictions destroyed demand and depleted cash. This important financing will allow us to keep our strong relative position and better manage debt leverage and risk as government restrictions are lifted and the market recovers. The positive reaction from the public markets is a strong endorsement of the strength of our franchise.”


Air Canada is Canada’s largest domestic and international airline, serving over 51 million guests in 2019. The carrier is a founding member of the Star Alliance and is the only international network carrier in North America to receive a Four-Star rating from the independent U.K. research firm Skytrax. Air Canada is one of the 20 largest airlines in the world and in 2019 was also named ‘Best Airline in North America’ by Skytrax.


Source: Air Canada