Shares in JetBlue Airways plunged by 4.21% yesterday after Lufthansa announced a new financing plan that could eliminate its stake in the New York-based airline.

The German carrier will offer notes due in 2017 that investors can exchange for 46.7 million shares of JetBlue common stock owned by Lufthansa, according to a JetBlue filing on 29 March.

The shares represent all of Lufthansa's 15.8% stake in Jet Blue, which it acquired in 2007 for $300 million.

JetBlue says it will receive no financial benefit if the investors select the option to convert the notes into shares.

Lufthansa's offer includes the power to give investors who exercise the exchange option cash instead of shares, JetBlue adds.

Lufthansa plans to complete the financing round on 5 April, JetBlue says.

Source: Flight International