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.
“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.