Air Astana Announces IPO with $300 Million Target: A Strategic Move for Expansion

Air Astana, Kazakhstan’s flagship airline, is making significant strides in the financial world with its announcement of a dual listing on both the London and Kazakhstan stock exchanges. This bold step, revealed in mid-January, aims to generate approximately USD 300 million in gross proceeds. Of this amount, Air Astana intends to raise about USD 120 million directly.

This initiative sets the stage for an expected market capitalization of the Air Astana Joint Stock Company, which could range between USD 770 million and USD 962 million, as detailed in their January 29 filing.

The upcoming Initial Public Offering (IPO) is not just a local event; it will span across the London Stock Exchange and two Kazakhstan markets – the AIX and KASE. The pricing for this offering is indicative, with the range set between USD 8.50 and USD 11.00 per global depositary receipt (GDR) and USD 2.13 to USD 2.75 per share.

The final pricing will be determined through a bookbuilding process and is expected to be announced around February 9. This announcement will include comprehensive details of the offering in a prospectus, as stated by the company. Trading is scheduled to commence in London on the morning of February 14 and in Kazakhstan shortly thereafter, around February 15.

Notably, both shareholders of Air Astana – the Kazakhstan Samruk Kazyna Sovereign Wealth Fund and the British aerospace and defense company BAe Systems – will be divesting shares and GDRs in this public offering.

CEO Peter Foster has expressed optimism about the offering, citing strong investor interest and a positive response. He emphasizes that the proceeds from the IPO will bolster the company’s growth strategy. Foster highlights Air Astana’s potential as a lucrative investment opportunity, especially given its status as one of the fastest-growing airline groups. He is confident in the long-term value creation for future shareholders.

In a show of growth and expansion, Air Astana celebrated the delivery of its 50th aircraft, an A321-200NX(LR) EI-DKG (msn 11665), on January 20. This milestone, marked by the aircraft’s arrival from the Airbus assembly line at Hamburg Finkenwerder, aligns with the carrier’s ambitious strategy to expand its fleet to 80 aircraft by the end of 2028. The airline has already demonstrated financial robustness with an operating profit of USD 149 million for 2022, setting a strong foundation for its upcoming IPO and future expansion plans.