1. ¿Por qué Air Berlin quiere hacer una IPO?
The decision of Air Berlin to launch an IPO is based on three main reasons that go along with the company’s corporate strategy. The company wants to raise gross proceeds of €350 million in order to fund the growth of its aircraft fleet, to pay off debt and to invest in sustainable growth. Hereby, 50% of net proceeds (total: €290 million) will be invested into purchasing 55 new aircrafts. Air Berlin wishes to expand its fleet by Airbus 320 airplanes, which will incur economic benefits as well as enable access to a broader pool of pilots. The expansion increases Air Berlin’s growth prospects and is predicted to consolidate its position in the European airlines market. Another 10% of the fund raising is to be used for paying off debt outstanding to banks. This will decrease Air Berlin’s cost of capital and enable more investment into growth opportunities. Last of all, the remaining 40% of the raised proceeds will be invested in organic growth such as the launching of new routes or into general corporate expenses. Furthermore the capital might be made available in order to purchase another 40 Airbus 320 aircrafts. It is moreover possible that the company might want to make use of the funds for a takeover in the future. All in all, the whole process is part of a change in corporate structure from a limited partnership to a public limited company and finally to a public traded company. The “Going Public” is part of a fund raising that is necessary for Air Berlin in order to grow and meet financial and strategic goals. 2. ¿Creés que es apropiado dada la corriente situación y la industria? Regarding the growth prospects of the industry we find opposing opinions. Although airline travel and number of passengers only increased by 2.8 and 4.2%, respectively from 2000 to 2005 (Compound Annual Growth Rate), McKinsey predicted a 13 % increase in the number of passengers until 2010. These growth prospects definitely outspace...
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