More than meets the eye: Air NZ's capital raise

More than meets the eye: Air NZ's capital raise
The much-expected Air NZ recapitalisation has a tinge of smoke and mirrors about it (Image: BusinessDesk)
Jenny Ruth
At first glance, Air New Zealand's $2.2 billion recapitalisation plan is more than twice what the market was expecting.However, there's a bit of smoke and mirrors stuff going on.The $1.2b rights issue is only slightly higher than the $1.1b the market had been expecting but the discount of the two new shares for every one share held is a savage 61%.Each new share will cost 53 cents each compared with the market price of $1.375 when trading was halted at 4pm on Tuesday.That puts the theoretical ex-rights price (terp) at 81c.Surprisingly,...

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