The procedure to lower the capital of Latvian national airBaltic airline by EUR 571 million has commenced, as LETA was told by Latvian Minister of Transport Kaspars Briškens after a press-conference concerning the airline’s new strategic partner – Lufthansa Group.
The minister explained that according to the government’s decision of the 30th of August 2024, the company would be authorised to commence the capital reduction procedure only after finding a strategic investor.
“This has now happened. This is why the State Secretary to the Ministry of Transport Andulis Židkovs is now authorised to sign the agreement on the reduction of capital at the 11th of February shareholders meeting of airBaltic. The decision will be officially approved then,” said Briškens.
After that, the changes will be registered with the Enterprises Register.
LETA previously reported that at the 30th of August 2024 meeting of the Latvian government it was decided to lower airBaltic capital by EUR 571.293 million for the initial public offering (IPO). At the same time, the company’s existing share structure will be simplified. The lowering the capital provides for airBaltic’s base capital to be reduced to EUR 25.179 million.
The requirement for the reduction of the share capital state that currently the company’s share capital consists of 25 647 282 A-category shares, where the nominal value of each share is EUR 10; 74 323 152 B-category shares, where the nominal value of each share is EUR 3; 113 164 518 C-category shares, where the nominal value of each share is EUR 1, as well as 38 660 300 D-category shares, where the nominal value is EUR 0.1.
airBaltic, in preparation for the IPO, has decided to simplify the existing share structure of the company. Thus, the nominal value of all A, B and C shares will be reduced to EUR 0.1 and EUR 571.293 million will be transferred to cover accumulated losses of previous years.
Similarly, no consideration or compensation will be paid to shareholders in connection with the reduction of the par value of these classes of shares, the regulations state.
On Wednesday, the 29th of January, an agreement was reached by Latvian Ministry of Transport, airBaltic, and Lufthansa Group, allowing the latter to perform EUR 14 million worth of investments into airBaltic.
airBaltic carried a total of 4.536 million passengers in 2023, an increase of 35.7% compared to 2022, and 44 100 flights, an increase of 18.3% compared to the year before.
The audited turnover of airBaltic in 2023 was EUR 664.289 million, which is an increase of 33.2% compared to 2022. The company made a profit of EUR 33.852 million as opposed to losses a year earlier.
The Latvian state owns 97.97% of airBaltic shares, while financial investor, Danish entrepreneur Lars Tussen’s Aircraft Leasing 1 owns 2.03%.
More on this topic: Lufthansa Group to acquire minority participation in airBaltic for EUR 14 million
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