ASTANA – Air Astana, a flag carrier from Kazakhstan, announced the price range for its initial public offering (IPO) that will commence in February, saying it plans to raise $120 million.
Photo credit: Air Astana.
Kazakhstan’s largest airline, which is 51% owned by Samruk Kazyna Sovereign Wealth Fund, and 49% by British BAE, confirmed its plan to float in London on Jan. 19.
“The company’s GDRs [referring to global depository receipt] will be priced at a range of $8.5 to $11 for one GDR consisting of core shares, which means that each share of the company will be at a price range between $2.13 to $2.75 per share,” said Air Astana Chief Financial Officer Ibrahim Canliel during a Jan. 29 press briefing.
Air Astana aims for a market valuation of between $770 million and $962 million, Canliel said.
Canliel and Air Astana CEO Peter Foster are now in London for a roadshow. “Significant progress is being made towards our initial public offering on the London Stock Exchange, the Astana International Exchange, and the Kazakhstan Stock Exchange,” said Peter Foster.
He noted the response to the offering has so far been strong and positive.
“Both locally in Kazakhstan, here in London, and in other parts of the world, where we have been presenting the company to the investor community now for over two and a half months,” said Foster.
IPO will take place on three exchanges – the London Stock Exchange, the Astana International Exchange (AIX), and the Kazakhstan Stock Exchange (KASE).
“At AIX and London, we will be offering GDRs, and ordinary shares will be offered through the Kazakhstan Stock Exchange,” said Canliel.
The $120 million that Air Astana plans will “cater for its investment needs for the next stage of growth for the company.”
“It is also important that the two shareholders have committed to a lock-up period for 180 days after the transaction,” said Canliel.
Canliel said the listing will be ongoing till Feb. 8. The unconditional dealings in GDRs are scheduled to commence on the London Stock Exchange on Feb. 14 and on the AIX and the KASE on Feb. 15.
Commenting on the company’s financial health and performance, Canliel said Air Astana was one of the first airlines to return back to profitability after COVID-19 as early as 2021. “While the airlines globally are still trying to get back to pre-2019 levels, in our last 12 months, we are running 56% ahead of 2019. Our revenues in the last 12 months are 32% ahead,” he said.
In terms of financial stability, he said the company has been in a “very comfortable cash position,” running at 25% in 2022 and 26% in the first nine months of 2023 of total sales in terms of cash.
In December, the company announced a record 20.5% increase in total revenue and other income in the first nine months of 2023, reaching $900.6 million compared to $747.2 million in the same period of 2022. The operating profit rose by 11.2%, reaching $128.9 million, compared to $115.9 million during the first nine months of 2022.
The company planned to float earlier, but the process was delayed multiple times. Foster said it was all “due to geopolitics.” The first impeding factor was the COVID-19 pandemic, and the second one was the war in Ukraine.
Air Astana flies 49 aircraft, and Foster said last week the company took delivery of its 50 fleet. The plan is to have 80 aircraft by the end of 2028.
