Avation plc

March 09, 2011 06:36 ET

Issue of Equity

                                                                                        09 March 2011
                                                  AVATION PLC
                                                (the "Company")
                                        PLACING OF NEW ORDINARY SHARES

Avation Plc, the aircraft leasing company, is pleased to announce that it has conditionally raised £10 million
before  expenses from a placing ('the Placing') of 10,000,000 new ordinary shares of the Company ('the Placing
Shares'),  at  a  price of 100 pence per share, through W H Ireland Limited (W H Ireland) to clients  of  W  H

Background to and Reasons for the Placing

On 10 January 2011, the Company entered into an agreement ("ARAN Agreement") with Skywest Airlines (Australia)
Pty  Ltd  ("Skywest") and Virgin Blue Airlines Pty Ltd ("Virgin Blue") to provide a fleet  of  up  to  18  new
commercial  aircraft which will operate along the length of the Eastern Coast of Australia.  Pursuant  to  the
ARAN Agreement, the Company proposes to provide aircraft to Skywest under aircraft operating lease agreements.
Skywest,  in  turn,  proposes to enter "wet-lease" arrangements for the operation of the aircraft  for  Virgin
Blue.  Wetleasing the aircraft includes the provision of the aircraft, the actual flight and cabin  crew,  the
maintenance, the insurance and the general operation.

In  contemplation of the arrangement envisaged by the ARAN Agreement, the Company has entered into a sale  and
purchase contract (the "Supply Agreement") with Avions de Transports Regional ("ATR") pursuant to which ATR is
to  supply  to the Company an initial eight aircraft, comprising four ATR 72-500 aircraft and four ATR  72-600
aircraft.  Further  to  these firm deliveries the Company has acquired five ATR 72-600 aircraft  options,  and
seventeen  aircraft  purchase rights, which if exercised, will be destined for operation on  Virgin  Blue  and
Skywest  airline networks. The Supply Agreement was agreed as a consequence of a tender process  during  which
the Company determined that the ATR aircraft were suitable.

The  purpose  of  the  Placing is to fund the pre-delivery payments for the first eight aircraft  and  placing
costs.   The  Company has further entered into term sheets for associated debt financing which is required  to
acquire  the first eight aircraft. Additional debt financing is proposed to be supported by the Export  Credit
Agencies of the Republic of France ("COFACE") and the Italian Republic ("SACE"). However, the Placing  is  not
conditional on the acquisition of the ATR aircraft and will otherwise be available for the Company's  purchase
of alternative aircraft should the need or opportunity arise.

The Placing

The  Placing is conditional, inter alia, on the resolutions being passed by shareholders of the Company at the
General  Meeting scheduled to take place at 5pm on the 18 March 2011. The Placing Shares will rank pari  passu
in  all  respects  with the Company's existing ordinary shares in issue. Following admission to  trading,  the
Company's  total  issued share capital will be 38,532,220 ordinary shares. The Placing Shares  will  represent
25.9% of the enlarged issued share capital of the Company.

Application  will  be  made for the Placing Shares to be listed on the Official List pursuant  to  a  Standard
Listing  and admitted to trading on the London Stock Exchange's ("LSE") main market for listed securities.  It
is  expected  that  admission  to  the LSE and that dealings in the fully paid  Placing  Shares,  will  become
effective as of 8:00 a.m. on 21 March 2011.

Admission  is  subject  to  the  passing of the resolutions at the General  Meeting,  the  publication  of  a
prospectus*  and a placing agreement with WH Ireland becoming unconditional in all respects,  save  only  for
admission, and not being terminated.

The  Placing  Shares  will,  when issued, rank pari passu in all respects with the Existing  Ordinary  Shares
including the right to receive dividends and other distributions declared following admission.

 *The prospectus will be prepared in accordance with the Prospectus Rules of the Financial Services Authority
(the "FSA") made under section 73A of FSMA and approved by the FSA under section 87A of FSMA


Avation PLC
Jeff Chatfield, Chairman                                               +44 7783 942 553

Harry Ansell, Stockbroker                                              +44 20 7220 1670
James Joyce                                                            +44 20 7220 1666

Financial Public Relations
Bishopsgate Communications                                             +44 207 562 3350
Laura Stevens/Giang Nguyen


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