EasyJet raises £419m to guard against more disruption

EasyJet has raised £419m from investors to strengthen its balance sheet against the potential costs of further disruption from Covid-19.

The budget airline issued 59.542m new shares at a price of 703p a share - a 5% discount to the closing share price on 24 June. New and existing shareholders bought the shares, which represent 14.99% of its share capital before the sale.

EasyJet announced the share placing after the market closed on Wednesday. It said the money, net of transaction costs, would help protect against having to ground its fleet again or a longer-than-expected recovery in demand because of the Covid-19 crisis.

The FTSE 250 company had sought to raise £400-£450m in the accelerated bookbuild. It was forced to stop flying on 1 April as European countries implemented travel bans to limit the spread of Covid-19.

The airline resumed flying a partial schedule on 15 June and expects to increase the number of flights but experts have warned that a second coronavirus wave could hit Europe. Demand is also uncertain with consumers wary about sitting at close quarters with others and Europe in a deep recession with a slow recovery expected.

"EasyJet consulted with a number of its major shareholders prior to the placing and has respected the principles of pre-emption through the allocation process," the airline said. The company is pleased by the strong support it has received from existing shareholders and others."

The new shares are scheduled to start trading on 15 July after receiving shareholder approval at a meeting the day before.