Thai Airways International plans to set the public offer price for the issue of up to 1 billion shares by September 15.
The final price of the new shares will be quoted after the road show ends in New York. The public can subscribe to the offering on September 16-17 at Bangkok Bank and Krung Thai Bank branches, with trading commencing in the Stock Exchange of Thailand (SET) on September 30.
The fund-raising plan aims to strengthen the company's capital structure managing strategy. The airline is facing fierce competition in a high-risk industry, which is affected by many factors such as disasters, epidemics and political turmoil.
The funds from the public issue will strengthen the company's financial status and support its business expansion projects, as well as products and service improvement that will elevate THAI to consistently rank among the top three airlines in Asia and the top five in the world, said THAI president Piyasvasti Amranand.
Piyasvasti said THAI aims to raise Bt15 billion from this share issue. Hence, the company may not sell all the new shares.
"We are confident that this public offering will prove successful, with positive response from both existing shareholders in Thailand and overseas as well as the general public," said Piyasvasti.
The company's operational results have been getting better since the first quarter of this year. It reported a net profit of Bt12.27 billion in the first half of this year and the forecast continues to be bright for the rest of the year. In July, cabin factor sky-rocketed by 74 per cent compared with 64 per cent in the second quarter this year. In addition, the Finance Ministry also exercised its right to purchase shares to maintaining its control.
Piyasvasti said the company has to focus on maintaining the debt-to-equity (D/E) ratio at the appropriate level to ensure its stable financial status and business expansion.
"After the fund-raising, it's expected that the company's D/E will drop to 1 from 1.75 at present. We try to keep our D/E ratio below 2 to ensure our financial stability," he said.
THAI's stock has already seen a turnaround, with the price adjusted from its floor level of Bt7 per share to Bt40 now, Piyasvasti said.
To smooth the path for the fund-raising, Phatra Securities, Finansa Securities and Morgan Stanley have been appointed as financial advisers and underwriters.
Anuwat Ruamsuke, assistant managing director of Phatra Securities, said THAI's capital-raising has been divided into two parts. The first part will enable the Finance Ministry to maintain its status as the majority shareholder with a 51.03 per cent holding. To maintain the stake, the ministry will have to spend another Bt7.65 billion to purchase new shares.
The second part will allow old shareholders to subscribe to 15 million shares, which is expected to raise Bt6.8 billion.
The price would be based on its average price in the SET in the past two months. It has moved between Bt32-Bt42 in this period.