Asia Aviation plans initial public share offering

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BANGKOK, May 22 – Asia Aviation, a holding company owning a majority 51 per cent of Thai AirAsia, will offer its shares through an initial public offering (IPO) on May 23-25, according to Chief Executive Officer Tassapon Bijleveld.

The company’s shares are to start trading on the Thai stock market on May 31. It set an IPO price of Bt3.70/share, which is to be offered Wednesday through Friday this week.

Mr Tassapon expressed confidence that the share price will be higher than the IPO price, as a positive feedback during roadshows was demonstrated by investors who wanted Thai AirAsia stocks 11 times the number of shares offered.

That Asia Aviation is listed in the Stock Exchange of Thailand (SET) will help strengthen the company’s financial stability and make it easier to double its fleet size, CEO Tassapon said. The firm is planning to have 48 Airbus-A320 aircraft in the next five years from its current 24.

National Securities’ Managing Director Suvapa Charoenying said Asia Aviation has about 1.2 billion IPO shares, calculated as 25 per cent of its paid-up capital, with a market capitalisation of Bt18 billion.

Thanachart Securities Plc and CIMB Securities (Thailand) are joint lead underwriters for the Thai AirAsia IPO stocks.

Ms Suvapa said the company’s earning and profit are growing at a rate of around 20-25 per cent per year. The first quarter alone earned a profit of Bt600 million. The company will not pay dividend to its shareholders in the first three years.

Meanwhile, Asia Aviation CEO Tassapon said the decision on whether the airline will be moved to operate at Bangkok’s Don Mueang Airport will be made within 1 to 2 months.

He viewed there are still many business opportunities for low-cost airlines due to a limitation on airline service providers which does not comply with the large population of about 680 million in the South East Asian region.

Having open new more routes, Thai AirAsia aims to attract 8 million passengers this year from 7.2 million in 2011. The passenger ratio/flight is set to increase 81-82 per cent, from 80 per cent last year.