Canada Jetlines (AU, Toronto Pearson) is to raise CAD13.5 million Canadian dollars (USD9.95 million) through a non-brokered private placement with Jetstream Aviation Inc., which will result in this Canadian investor holding a controlling stake of about 50% of the leisure airline. The proceeds from the offering will be used for aircraft acquisitions and general corporate and working capital purposes, the company announced in a statement.
The leisure airline focuses on "high-demand, sunny destinations" and currently operates three leased A320-200s but now plans to expand its fleet to 15 aircraft by 2025.
The offering will be completed in three tranches. Jetstream Aviation will buy the first tranche of 19,598,017 shares, representing about 19.9% of Canada Jetlines, for CAD3.3 million (USD2.55 million). The first tranche will be issued about two business days after the transaction is approved by the NEO Exchange, now operating as Cboe Canada.
The second and third tranches will require shareholder approval by stock exchange rules, resulting in the investor holding about 50% of the company's shares. In the second tranche, Jetstream will buy 29,416,635 shares, representing another 15% of the airline, for CAD5 million (USD3.7 million). Two months later, the third trance will see it acquire another 29,416,635 shares, another 15% stake, also for CAD5 million. On completion, Jetstream Aviation will hold 78,431,287 shares in the airline.
The investor can appoint two directors to the company's board as part of the deal. The completion of the offering is subject to customary closing conditions and exchange approval.
