By Andy Sambidge
German carrier says it has issued new bonds alongside $418m bond placed by Abu Dhabi's Etihad
German carrier airberlin said on Thursday it has successfully implemented its previously announced recapitalisation programme, through the issuing of new bonds alongside the 300 million euros ($418 million) convertible perpetual bond placed to Etihad Airways.
It said in a statement that the recapitalisation in the amount of 550 million euros will strengthen its equity capital and liquidity position for the long term.
The second largest airline in Germany, airberlin offers a global route network through its strategic partnership with Etihad Airways, which has a 29.21 percent share in the company.
Through two new bonds - one in euros and the other in Swiss francs - airberlin said it has raised a total of 252 million euros.
The holders of the currently outstanding corporate bonds due in 2014 and 2015 have accepted the offer of exchanging their notes to a total sum of 12.63 million euros, the airline said, adding that it will use the net proceeds for general corporate purposes for a maximum amount of 150 million euros and the refinancing of existing commitments.
airberlin’s chief financial officer, Ulf Hüttmeyer, said: "This recapitalisation exercise has allowed us to significantly strengthen our equity capital and airberlin’s levels of liquidity.
"At the same time we are reducing our net debt and have lower interest payments to make. Even though we did not reach the envisaged 100 million euros for the exchange, we undertake to use that part of the cash proceeds which are significantly higher than expected to purchase the outstanding bonds in the envisaged amount on the market at a satisfactory price if the market opportunity arises."