Cebu Air Defers IPO To After Elections

March 31, 2010

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The Philippines' Cebu Air on Wednesday said it had deferred its PHP25.7 billion pesos (USD$565 million) initial public offering to after national elections in May, knocking down shares of its parent.

The sale of new and existing shares, the second airline IPO in Asia this year, was expected to kick off with a roadshow on April 5, with a listing slated for May 3.

"Despite strong interest in the IPO at this time, it is in the better interests of the stakeholders to pursue the listing after the coming elections," Cebu Air said in a letter to the Philippine Stock Exchange.

No alternative date was given for the IPO. National elections will be held on May 10.

The planned share sale by Cebu Air comes after Singapore's Tiger Airways raised USD$178 million in February, with the sector looking to capitalise on a rebound in travel demand.

Cebu Air, which operates Cebu Pacific, had said it would use the funds to expand its fleet to better compete with Tiger and Malaysia's AirAsia.

Cebu Air planned to offer 125.25 million new shares at a maximum price of 95 pesos, which would raise around USD$260 million.

It also planned to sell 110.3 million existing shares in the IPO, with an over-allotment option of 35.3 million shares.

(Reuters)