Silverjet announced today (30 April) it will potentially receive $100m (”51m) after forming a memorandum of understanding with an investor in the United Arab Emirates.
Subject to regulatory and shareholder approval, this will equate to an initial $25m boost plus a further investment of up to $75m to expand the airline”s operations to new markets in Asia and Africa, as well as other destinations within the Middle East.
Silverjet CEO Lawrence Hunt said: ”It is particularly encouraging to have secured this agreement in a challenging environment for all airlines. The support of this investor demonstrates the strength of Silverjet's exclusively business class model.”
The first $25m will be in the form of a debt and equity package, with the latter amounting to $8m subscribed at 17p per share.
The investor receives a 28% stake in the business-only airline and will appoint two representatives to Silverjet”s Board of Directors.
Talk of new routes is quite a turnaround. Many expected the airline to share the fate of Maxjet and Eos and fold, as it has faced investment challenges with a wafer thin share price of around 14p ” which considering they peaked at 209p last March represents quite a fall from grace.
In the ”unlikely event” that this investment is not completed, Silverjet”s statement confirms it will have to source alternative means of funding ”as a matter of urgency.”
But Hunt sounds bullish: ”The Board believes that the combination of Silverjet's already strong brand and presence in the market with the support of a long term strategic investor will enable Silverjet to continue its growth.”
Silverjet announced on 10 April it was in discussions regarding a possible takeover, and today”s statement says it remains in an ”offer period” and it cannot currently comment further, but an announcement will be made ”as soon as practicable.”
The airline”s April passenger figures will be published on 6 May.