Asia Aviation PCL, the major shareholder of budget carrier Thai AirAsia, said today it is selling 1.21 billion shares in the airline to raise up to 4.48 billion Thai baht (US$142.75 million) in an initial public offering (IPO) in a move to increase its stakes and expand the airline, China’s Xinhua news agency reported.

Asia Aviation said in a statement that it is offering the stocks at 3.7 Thai baht (US$0.11) per share to investors during May 23-25 on the Stock Exchange of Thailand.  

“This is another crucial step that will stabilise Thai AirAsia’s financial status and allow the company to march forward to its planned goal,” Tassapon Bijleveld, CEO of Asia Aviation said.  

“We aim to grow at least 20-25 percent from 2011, which will be supported by our new fleet, new route plans and increase flight frequency on potential routes,” he added.

The 1.21 billion shares represent 25 percent stakes in Thai AirAsia.

The company will use part of the IPO proceeds to buy Thai AirAsia’s newly-issued ordinary shares to hike its stake in Thai AirAsia to 55 percent.

Thai AirAsia will use some of the proceeds to double its Airbus A320 fleet size to 48 aircraft within the next five years while the rest of the takings will be used for working capital and business operations.

The company said the IPO price was appropriate and the demand following the book-building among the institutional investors in local and overseas markets was 10 times oversubscribed.

- Bernama