Interjet announced it will decide within two weeks whether to hold an IPO that may be worth USD200 million (Bloomberg, 07-Apr-2011). The carrier is in talks with potential underwriters to sell a stake of at least 15%. The money raised would help Interjet fund its plan to double the number of passengers it carries to 8 million by the end of 2011.
Interjet to decide within two weeks whether to hold IPO
You may also be interested in the following articles...
Interjet moves forward in strengthening its transborder position. Politics spurs market uncertainty
Mexico’s third largest airline, Interjet, recorded a surge in international passengers during 2016, reflecting the company’s desire to capitalise on a loosened bilateral agreement between the US and Mexico that eliminated restrictions on certain routes between the two countries. Interjet added several new routes to the US in 2016, upping competition with its Mexican rivals and the US airlines.
Based on Interjet’s aircraft delivery schedule and forward looking data, the airline’s capacity is set to grow at a healthy pace in 2017 as it absorbs new route launches from 2016 and expands its fleet. The airline logged 18.3% capacity growth in 2016.
Interjet is undertaking a significant US expansion as changing political tides are creating uncertainty about future travel patterns between Mexico and the US. Interjet asserts that business travel demand on its largest international route – Mexico City to New York JFK – remains robust, and the airline is expanding frequencies on the route.
But Mexico-US relations remain fragile in the light of uneasiness about changing trade pacts, and the heightened rhetoric over construction of a border wall between the two countries that was a hallmark of (now) President’s Trump campaign.
US airlines get boost from ‘Trump Bump’ but protectionist rhetoric creates long term uncertainty
The mystifying rise of now-US President Donald Trump is full of paradoxes. He embarked on his presidency with one of the lowest approval ratings in recent history, yet after his election victory markets were buoyed by a significant “Trump Bump”, carried by his promises of tax cuts, less regulation and an increased focus on revamping the nation’s infrastructure.
US airlines benefitted from the Trump Bump with a rally in corporate travel at YE2016, which helped many of those companies deliver a better than expected unit revenue performance that will propel them into positive territory for 1H2017.
However, the Trump Bump could be tempered by his continued protectionist remarks and the pace with which he delivers on his pro-business campaign promises.The uncertainty could create a certain level of volatility for US airlines as they work toward restoring business yields. But for now they believe the momentum in corporate demand and yields should continue into the foreseeable future.