Japan’s biggest airline ANA to raise $3.2b in shares to fund 787 jet purchases

All Nippon Airways Co. (ANA) aircraft stand parked at Haneda Airport in Tokyo, Japan, on Wednesday, April 26, 2017. Photographer: Tomohiro Ohsumi/Bloomberg

Japan’s biggest airline ANA Holdings said on Friday it will issue new shares to raise $3.2 billion, much of which will be used to fund its orders of fuel-efficient Boeing 787 Dreamliner jets.

Like other big global airlines ANA has been making cost cuts, including pay reductions, to cope with a coronavirus-driven travel slump.

But while many other airlines have been deferring widebodied plane deliveries to safeguard their finances, ANA has opted to stick with its pre-pandemic 787 orders from Boeing.

It says the 787, which is smaller than other widebody models, will be a cost effective alternative to bigger planes that may struggle to make money even after the coronavirus crisis ends.

“On routes to Europe and the United States we flew the Boeing 777, but after the coronavirus, rather than 777 capacity, the 787 is going to be a better size,” ANA Senior Vice President Kimihiro Nakahori said at a press briefing.

In February the airline, which was the launch customer for the carbon-fibre 787, ordered 20 new Dreamliners worth $5 billion at list price, bringing its total orders to 100 planes.

Some of those may be configured with fewer business-class seats, Nakahori said, because ANA expects a quicker rebound in leisure travel.

ANA does not expect its home market to recover for two years, and has forecast the downturn in international travel to last until 2024. The carrier last month forecast a record operating loss of 505 billion yen for the year to March 31.

Its first share issue since 2012 comes after ANA last month secured $3.8 billion in subordinated loans to replenish its cash reserves.

Of the 14 million shares it plans to issue, ANA said it will offer a quarter to overseas investors.

ANA picked Nomura Holdings and Goldman Sachs Group as two of the global coordinators for its first share offering since 2012, sources earlier told Reuters. ANA declined to identify the coordinators.

Reuters

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.