Volaris (Y4) has announced it secured shareholder approval to increase its capital by US$160M. The airline updated its balance sheet as shown in a stock exchange filing dated September 22.
Since Y4 celebrated an extraordinary general meeting days before, its Board of Directors was evaluating different financing alternatives. As a result, the board proposed several measures, one being the capital increase.
The step will strengthen the capital position of the company. Y4’s goal is to obtain the most cost-effective financing structure to reaffirm its long-term commitment to employees and shareholders.
Additionally, the airline expects to take advantage of potential growth opportunities. Despite the COVID-19 crisis, it sees the situation as an opportunity to build up more quickly its competitive position. This would include neglected market opportunities, increase route network, and fleet.
Actions in the Short-Term
The carrier is also considering a rights offering, an outright sale of shares, or the issuance of debt in the form of convertible debentures, it said in the statement. The final terms and conditions will depend on the market conditions at the time of offering.
Additionally, the airline will launch new routes in October. The new Mexico City-Tampico route will run three times weekly while the Mexico City-Cozumel one will be available two times per week.