Air France-KLM Raises €2.26 Billion In Oversubscribed Rights Issue

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Air France-KLM Raises €2.26 Billion In Oversubscribed Rights Issue
Credit: © Reuters.

By Scott Kanowsky -- Air France-KLM SA (EPA: AIRF ) says it raised €2.26 billion from its latest capital increase, as the French-Dutch carrier looks to pay back state aid and reduce costs following recent struggles brought on by the collapse in air travel during the pandemic.

The company said the rights issue - which it launched in May - was "well oversubscribed," with total demand amounting to about €2.6 billion.

Air France-KLM said both the French and Dutch states maintained their current shareholdings, while logistics group CMA CGM built a 9% stake as it moved to take advantage of growing demand for air cargo during the recent global supply chain woes.

"This operation, which is part of a broader strategy to transform and streamline our Group, will allow us to emerge with a stronger balance sheet and increased strategic flexibility," said Air France-KLM CEO Benjamin Smith in a statement.

Smith added that Air France-KLM will focus on "seizing the opportunities that will arise" as the airline industry recovers from the pandemic.

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