Roissy (France), 20 March 2019 - Air France-KLM (the "Company") (Euronext Paris: FR0000031122) has successfully placed today bonds convertible into new shares and/or exchangeable for existing shares ("OCEANE") due 2026 (the "Bonds") for a total amount of approximately €500 million by way of a private placement to institutional investors only (the "Offering"), representing 27,901,785 underlying shares.
The net proceeds from the issue of the Bonds will be used by the Company for general corporate purposes, including the refinancing of the subordinated perpetual notes issued in 2015 and callable in October 2020.
As a result of the success of the Offering, the nominal unit value of the Bonds has been set at €17.92, corresponding to a premium of 70% above Air France-KLM's reference share price on the regulated market of Euronext Paris ("Euronext Paris").
The Bonds will be issued at par on March 25, 2019 (the "Issue Date"), being the expected settlement and delivery date of the Bonds, and will bear from the Issue Date a coupon of 0.125%, payable annually in arrears on March 25 of each year (or on the following business day if this date is not a business day), starting on March 25, 2020.
Unless previously converted, exchanged, redeemed or purchased and cancelled, the Bonds will be redeemed at par on March 25, 2026 (or on the following business day if this date is not a business day). The Bonds may be redeemed prior to maturity at the option of the Company, under certain conditions, and at the option of the bondholders, notably in case of a Change of Control of the Company (as defined in the terms and conditions of the Bonds).
In particular, the Bonds may be fully redeemed earlier at par plus accrued interest, at the Company's option from April 15, 2022 until the maturity date of the Bonds, if the arithmetic average, calculated over a period of 10 consecutive trading days chosen by the Company from among the 20 consecutive trading days preceding the publication of the early redemption notice, of the products of the Company's volume weighted average price on Euronext Paris on each trading day and the applicable exchangeable ratio on each such trading day exceeds 130% of the nominal value of the Bonds.
Moreover, the Bonds may be redeemed at par plus accrued interest at the bondholders' option on March 25, 2024.
Application will be made for the listing of the Bonds on Euronext AccessTM (the former open market) of Euronext Paris to occur within 30 days after the Issue Date.
HSBC, Natixis and Société Générale acted as joint global coordinators and joint bookrunners of the Offering (the "Joint Global Coordinators") and BNP PARIBAS as joint bookrunner (together with the Joint Global Coordinators, the "Managers").
Subscription from existing shareholders
The French state has subscribed to 3,987,165 Bonds in the context of the Offering, corresponding to a nominal amount of €71.45 million.
Bondholders will be granted a conversion/exchange right of the Bonds into new and/or existing shares of the Company which they may exercise at any time from the 40th day following the Issue Date (i.e. May 04, 2019) and up to 5.00 p.m. (Paris time) on the 7th business day (inclusive) preceding the maturity date or the relevant early redemption date.
The conversion ratio is set at one share per Bond subject to standard adjustments in certain cases. Upon exercise of their conversion/exchange right, bondholders will receive at the option of the Company new and/or existing Air France-KLM shares carrying in all cases all rights attached to existing shares as from the date of delivery.
In the context of the Offering, the Company agreed to a lock-up undertaking for a period starting from the announcement of the final terms of the Bonds and ending 90 days after the Issue Date, subject to certain customary exceptions or waiver from the Joint Global Coordinators.
As a result of the Offering, the issue of the Bonds in an aggregate amount of approximately €500 million represented by 27,901,785 Bonds each with a nominal value of €17.92, would lead to a maximum dilution of 6.5% of the outstanding share capital, should the Company decide to exclusively deliver new shares upon conversion.
Legal framework of the Offering and placement
The Offering of the Bonds has been conducted solely on a private placement basis. The Offering has been made in compliance with Article L. 411-2-II of the French monetary and financial code (Code monétaire et financier), as per the authorisation granted by the Company's extraordinary general meeting held on May 16, 2017 (15th resolution), via an accelerated bookbuilt private placement in France and outside of France (excluding in particular the United States, Canada, Australia or Japan), to institutional investors only.
The Offering of the Bonds is not subject to a prospectus approved by the French Financial Market Authority (Autorité des marchés financiers) (the « AMF »). Detailed information on Air France-KLM, including its business, results, prospects and related risk factors are described in the Company's registration document (Document de Référence) filed with the AMF on 29 March 2018 under number D.18-0232 which is available, together with Air France-KLM's interim financial report as at 30 June 2018, the consolidated financial statements as at 31 December 2018, all the press releases and other regulated information about the Company, on Air France-KLM's website (www.airfranceklm.com).
This press release does not constitute or form part of any offer or solicitation to purchase or subscribe for or to sell securities to any person in the United States, Australia, Canada or Japan or in any jurisdiction to whom or in which such offer is unlawful, and the Offering of the Bonds is not an offer to the public in any jurisdiction, including France.