IAG considering €2.75bn rights issue to bolster balance sheet
IAG shares slid on Friday after the British Airways and Iberia parent said it is considering a rights issue of up to €2.75bn to bolster its balance sheet.
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In a brief statement responding to press speculation, the company said no decision has been made as to whether or when to proceed with a rights issue and that a further announcement will be made as appropriate.
"As detailed in its Q1 financial results announcement on 7 May, going into the crisis IAG had a strong balance sheet and liquidity with cash and undrawn facilities at 30 April of €10b," it said. "IAG has taken appropriate actions to strengthen its balance sheet and boost its liquidity position."
Earlier in the day, IAG announced that it had extended its global commercial partnership with American Express and will receive a payment of around £750m.
At 1610 BST, the shares were down 4% at 200.20p.
The statement followed a report by Reuters suggesting that IAG was looking to raise funds in an equity placing or concurrent issuance of convertible bonds to stay afloat and avoid government bailouts.