Avianca prices shares in US IPO

Washington DC
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Latin American airline group Avianca hopes to raise up to $545 million in its US share offering, as it releases pricing details.

The Star Alliance carrier filed for an initial public offering (IPO) in the USA in September.

In its updated prospectus filed with the US Securities and Exchange Commission, the airline says it will offer 12.5 million new American depositary shares (ADSs) in the international offering. Each ADS represents eight preferred shares. Selling shareholders will also offer 14.7 million ADSs for a total of 27.2 million ADSs, says Avianca.

The carrier expects the ADSs to be priced between $17 and $20 each in the IPO.

Avianca expects net proceeds of about $220 million following underwriting discounts and transaction expenses, assuming an offering price of $18.50 per ADS, it says.

The airline has said it will use the proceeds to finance its fleet modernisation plan. The carrier has entered into agreements to acquire several new aircraft. These include up to 15 Boeing 787s to be delivered between 2014 and 2019, it says in SEC documents. Avianca also has 33 current generation Airbus A320 family aircraft on order to be delivered between the second half of 2013 and 2016, 33 A320neos for delivery between 2017 and 2019, two Airbus A330 freighters to be delivered in the second half of 2013 and 15 ATR 72s for delivery between the second half of 2013 and 2015.