Comair planning to launch new share offer; Middle East Airlines to commence partial privatisation


Comair (-3.6%) fell on Thursday (08-Apr-2010) in response to plans to raise USD17.2 million through the issue of 69.2 million new shares to upgrade a portion of its fleet to B737-800 aircraft.

  • Comair plans to raise USD17.2 million through a rights offer to upgrade its fleet to B737-800 aircraft.
  • Comair secures favorable pricing from Boeing for the acquisition of the new aircraft.
  • Comair acquires a controlling interest in Holiday Tours' wholesale business to enhance its technology infrastructure.
  • Fly540 Zimbabwe obtains a franchise license and plans to launch operations in June 2010.
  • Middle East Airlines plans to commence partial privatization and expects shares to trade on the Beirut Stock Exchange by 2011.
  • Middle East-Africa Airline Daily, a new strategic business information service, is launched by the Centre for Asia Pacific Aviation.

Comair stated it has been able to secure "favourable pricing from Boeing for the acquisition of these aircraft", with intended delivery dates from 2011 to 2015. The capital raised through the rights offer will be utilised as the initial down payment to Boeing for the acquisition of the new fleet of aircraft. Rights offer shares will be offered for subscription to shareholders on the basis of 14 new rights offer shares for every 100 shares held, for subscription at ZAR180 cents per rights offer share.

Also during trading, Comair announced the acquisition of a controlling interest in the Holiday Tours' wholesale business, effective 06-Apr-2010. Comair plans to incorporate its advanced technology infrastructure into Holiday Tours, which will assist the trade and real time booking functionality to all its point-to-point destinations.

Elsewhere in Africa, Lonrho subsidiary, Fly540 Zimbabwe, obtained a franchise licence from Fly540 Africa, enabling the carrier to finalise its business development plan for submission to the Civil Aviation Authority of Zimbabwe for an Air Operator's Certificate. The carrier is now planning to launch service in Jun-2010, although this is dependent on the AOC issuance. The carrier was initially scheduled to launch operations in Sep-2009, which this subsequently shifted to Oct-2009, and then deferred indefinitely, due to the company's failure to obtain its AOC (due to the process to obtain a franchise taking longer-than-expected). The carrier will operate ATR72 aircraft.

Kenya Airways (-0.8%) meanwhile slipped, while 1time was flat.

In the Middle East, Jazeera Airways (+1.0%) gained, despite the Kuwait Stock Exchange falling 5.5 points. Air Arabia (+0.1%) was up only slightly, while Kuwait National Airways and Royal Jordanian were flat.

Middle East Airlines IPO progressing

Also in the Middle East, Middle East Airlines Chairman, Mohammed Hout, stated the company will commence the process of partial privatisation this year, adding that he expects shares in the carrier to commence trading on the Beirut Stock Exchange by 2011, once the IPO process has been completed. The carrier plans to sell a 25% stake in the company on the market. The carrier's initial plans to partially privatise the company in 2008 were delayed by the global economic meltdown. MEA, founded in 1945, currently operates a 13 aircraft fleet serving a network of 29 destinations. Two additional aircraft are scheduled for delivery in May-2010.

The Centre for Asia Pacific Aviation (CAPA) has launched a unique new strategic business information service covering one of the world's most exciting emerging aviation markets. Middle East-Africa Airline Daily is an efficient morning briefing on airline developments from both regions. Covering fleets, routes, financials, traffic, bilateral agreements, alliances, financing, ownership, along with analysis of all significant developments, it is your one-stop shop to aviation news from Africa and the Middle East - and best of all it's free for a limited time. Sign-up today!

Selected African and Middle Eastern airlines share price movements (% change): 07-Apr-2010

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