During its Extraordinary General Meeting (EGM) held today, Jazeera Airways shareholders approved a 10% increase to the company’s capital, from US$ 70 million to $72.5 million.
The Capital Markets Authority (CMA) approved the capital increase earlier and the process is now subject to final approvals by regulatory authorities in accordance with the provisions of the law.
The increase is a precautionary step to adhere to regulatory capital requirements as operations remain derailed by the prolonged closure of Kuwait International Airport.
It follows a recommendation by Jazeera’s Board in the face of the most challenging six quarters for the global economy and more specifically, the travel and tourism industry.
Despite the challenging conditions, Jazeera maintains a healthy asset base and a very strong unrestricted cash balance, which stood at KD17.6 million by the end of the first quarter of 2021 and is set to be increased by an additional KD10 million post the capital increase, which will set the company up for a solid resumption of operations once travel restrictions in the state of Kuwait are relaxed.
The capital increase is covered by issuing 20 million ordinary shares with an offering price of par value of 100 fils each in addition to a share premium of 400 fils per share or a total price of 500 fils per share.
The company is also in the process of submitting the public offering prospectus to the Capital Markets Authority in accordance with CMA law number of 2010 and its Executive Bylaws.