The raise capitalises on available COVID-19-related relief.
King & Wood Mallesons (KWM) has assisted Flight Centre, Australia’s largest travel retailer, on a capital raising effort worth $700m.
Effective 19 March, Flight Centre stopped trading on the ASX, and announced its COVID-19 response plan on 6 April. The raise is a major part of this plan, which consists of an institutional placement worth approximately $282m and an accelerated pro rata non-renounceable entitlement offer valued at around $419m.
The transaction also capitalises on the coronavirus-related relief provided by ASIC and ASX.
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“The combination of these initiatives is expected to ensure Flight Centre can trade through an extended period of uncertainty and disruption, can continue to deliver high-quality travel services to customers and can capitalise on opportunities as market conditions improve,” said M&A partner Paul Schroder.
KWM put together a team composed of M&A and restructuring experts to advise Flight Centre on the deal, led by Schroder and national head of restructuring Tim Klineberg. They were supported by senior consultant John Humphrey; head of public M&A David Friedlander; special counsels Amanda Isouard and Gavin Rakoczy; senior associates Shabarika Ajitkumar, Mark Vanderneut and John Arthur; and solicitors Stacey Stellatos, Georgia Feltis, Stephanie Rigg and Jing Wang.
“With the capital raising and new funding announced today, Flight Centre is positioned to overcome the COVID-19 pandemic and the travel and trading restrictions imposed by governments that are impacting the travel sector,” said Klineberg.
Flight Centre has also been granted a $200m extension to its debt facilities with advice from the banking team at Allen & Overy.
With the successful outcome of the transaction, KWM adds another notch to its belt when it comes to providing advice to ASX-listed clients on complicated urgent capital raisings. Recently, the firm served as Australian legal counsel in the deal to secure a NZ$1.2 billion institutional placement and share purchase plan for the Auckland international airport, working alongside top New Zealand firm Russell McVeagh.
In January, the firm assisted Bank of Queensland on a capital raising that consisted of a $250m institutional placing and a $25m targeted share purchase plan. The firm also advised oOh!media Ltd on a $167m underwritten equity raising in March.