Low-cost airline Blue Air, the largest Romanian air carrier and the second-largest player on the local market after Hungarian rival Wizz Air, prepares to raise EUR 50-60 mln through a bond issue next autumn and ponders having its shares listed on the Bucharest Stock Exchange (BVB) two years later, the company’s CEO Oana Petrescu announced.

“This is the funding we need to resume growth,” said Petrescu, who took over the post this spring. "We have not yet calculated the market value [of the company], nor have we decided where we will list [our  shares]. It is premature to say this,” said Petrescu, quoted by Profit.ro.

She explained that the company must first reach a profit rate of 10%-15% for the listing to make sense. In the financial year ended September 30, 2019, Blue Air achieved an IFRS operating profit of approximately EUR 8 million, from EUR 19 million losses (also according to IFRS) in the year before, according to information provided by the company.

Under the local accounting standards, the company posted losses in excess of EUR 30 million in the 2018 fiscal year at a turnover of close to EUR 500 million.

Blue Air was established in 2004 and has developed into a pan-European air operator, with operational bases in Romania, Cyprus, Italy and the United Kingdom. The business was launched by local businessman Nelu Iordache, highly active in the infrastructure construction sector, who was sentenced in December 2017 to six years and three months of imprisonment for having siphoned some RON 1.2 bln (EUR 250 mln).

At this moment, the company is controlled by Romanian investors Rada Cristian and Marius Puiu Mihail (general manager), with 45% each.

(Photo courtesy of the company)

editor@romania-insider.com