EasyJet raises 1.2 billion euros from bond deal as travel sector rebounds By Reuters

By Yoruk Bahceli and Abhinav Ramnarayan

AMSTERDAM (Reuters) – EasyJet raised 1.2 billion euros ($1.46 billion) from a seven-year bond sale on Wednesday, in a sign of investor confidence in a recovery in international travel and tourism.

The deal attracted investor demand of 5.8 billion euros, a lead manager announcement seen by Reuters said, helping the company to reduce the yield on offer to 2%, from around 2.375% when the sale first started on Wednesday.

The deal came at the top end of a 1.0 billion-1.2 billion euro target range.

The positive response from bond investors comes after British Prime Minister Boris Johnson set out a phased plan on Monday to end England’s COVID-19 lockdown.

Under the plan, Britain could see curbs on international travel removed as early as May 17.

Encouraged by positive news about travel in its biggest market Britain, easyJet (LON:EZJ) moved to appoint BNP Paribas (PA:BNPP), Morgan Stanley (NYSE:MS) and Santander (MC:SAN) as joint bookrunners on Tuesday to run a bond sale.

EasyJet said that bookings for flights for this summer had soared more than 300% since Britain’s announcement, and holidays by more than 600%, compared to their levels last week.

The airline’s share price has risen more than 18% to 982 pence this week, while the yield on its outstanding June 2025 notes has dropped 51 basis points in two sessions to 1.39%. Bond yields move inversely to prices.

Proceeds from the bond sale will be used for general corporate purposes and for refinancing debt, according to an investor announcement. EasyJet has a 500 million euro bond maturing in February 2023.