The Air New Zealand Limited (ASX: AIZ) share price is heading south after coming out of a trading halt on Thursday.
This comes after the company provided an update regarding its shortfall bookbuild.
At the time of writing, the airline operator’s shares are exchanging hands at 74 cents, down 6.33%.
Air New Zealand completes shortfall bookbuild
In a statement, Air New Zealand advised it has completed the shortfall bookbuild component of its rights offer.
The two for one pro-rata renounceable rights offer is for shareholders who didn’t take up shares in the company’s recent capital raise.
Air New Zealand said the shortfall bookbuild was well supported by existing shareholders and new investors. It comprised approximately 274 million shares.
The price of NZ$0.81 per share is a NZ$0.28 premium above the offer price of NZ$0.53 per share.
Eligible shareholders who elected not to take up their entitlements, as well as ineligible shareholders, will receive NZ$0.28 for each share sold. Payment is expected to be made by Monday 16 May.
This concludes the company’s NZ$1.2 billion equity raise, which is comprised of the rights offer and the shortfall bookbuild. Air New Zealand will use the proceeds to repay its existing crown loan, strengthen its balance sheet, improve liquidity, and help position the business for recovery.
Air New Zealand chair Dame Therese Walsh commented:
The Rights Offer was structured to provide all eligible Air New Zealand shareholders with a fair opportunity to participate in the equity raise or receive value for their rights.
We are delighted with the level of support shown for Air New Zealand by existing and new shareholders and to have been able to return value to those shareholders who did not or were ineligible to participate.
Air New Zealand share price summary
Since this time last year, Air New Zealand shares have lost 26% in value. The majority of these losses — 19.5% — have come in 2022. The share price reached a 52-week low of 72.5 cents last month before moving in a sideways channel.
Air New Zealand commands a market capitalisation of $887 million. It has approximately 1.12 billion shares on issue.
The post Here’s why the Air New Zealand share price is diving 6% today appeared first on The Motley Fool Australia.
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