Asia Aviation, owner of Thai AirAsia, has set an IPO price of 3.7 baht (USD$0.12) a share to raise THB4.5 billion baht (USD$143 million) in the Thai market this month, sources close to the deal said on Thursday.
Asia Aviation, a holding company that owns 51 percent of Thai AirAsia, will offer 1.212 billion shares, or 25 percent, in the initial public offering (IPO), the company said in a statement.
The 3.7 baht per share was near the top of the price range of 3.30-3.80 baht, which translated to a 2013 price to earnings ratio of 8.8-10.3, according to IFR Asia.
Asia Aviation will use the proceeds from the share sale to buy new shares in Thai AirAsia, taking its holding in the budget carrier to 55 percent, according to a filing to the Securities and Exchange Commission.
The holding of AirAsia International, a wholly owned unit of Malaysian AirAsia, Asia's largest budget carrier by fleet size, will then be reduced to 45 percent from 49 percent.
Thai AirAsia itself planned to offer 3.55 million new shares through a rights issue and aimed to use the proceeds from the sale to expand its fleet, spending THB1.5 billion baht in 2012-2014, the filing said.
The Thai budget carrier aimed to serve 8 million passengers this year to boost revenue growth to about 20-25 percent and planned to buy Airbus A320s to double its fleet to 48 over the next five years, according to its statement.
The IPO shares will be offered between May 23 and 25 and listing is expected on May 31.
Apart from the IPO shares, the airline's executives planned to sell 727.5 million secondary shares in a big lot transaction at the same IPO price on the first trading day, officials said.