CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure. CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure.

Where next as Webjet upsizes its equity raising to $346 million

We examine the details and consequences behind Webjet’s recently announced equity raise.

Webjet share price and an ever-evolving market

Investors have known for some time that Webjet (WEB) was set to tap the markets for fresh capital: they simply didn’t know how much the company was looking to raise, on what terms or how the market would respond.

Yesterday and today the market got a better idea – with the beleaguered travel company announcing the details behind a $275 million equity raise – comprised of an institutional and retail entitlement offer.

That picture became slightly modified today however, with Webjet announcing that it had successfully completed the institutional side of its planned entitlement offer and institutional placement; raising $231 million in the process and issuing 135.7 million new shares – at just $1.70 per share.

Those ‘institutional shares’ are set to be issued on 14 April and be tradable on the same day.

Management commentary in focus

In response to this news, Webjet’s Managing Director, John Guscic today said:

'We are delighted with this strong demonstration of support from both our existing and new investors. This equity raising provides Webjet significant liquidity to navigate the near-term uncertain created by COVID-19, and importantly positions us to continue our leadership in our global WebBeds business and Australian OTA.’

Mr Guscic continued by arguing that Webjet provides:

'An essential distribution channel in the travel sector and anticipate we will play an even more valuable role connecting our clients and hoteliers in a recovering environment.'

Yet maybe most importantly, the company today revealed that with the 'Entitlement Offer now fully underwritten with the retail component of the Entitlement Offer expected to raise $115 million and together with the Institutional Placement and Entitlement Offer,’ Webjet is now anticipating that it will raise approximately $346 million – some $71 million higher than initially flagged.

Though management and institutional players have reacted positively, other market participants appeared less enthusiastic when the stock resumed trading this morning. Here, the Webjet share price was bid as much as 30% lower when it exited its suspension.

The stock did however rebound as the session progressed: As of 12:43 AEDT, Webjet traded at $3.140 per share – well ahead of its intraday low of $2.59 per share.

Webjet’s Retail Entitlement offer is set to open on 8 April.

How to trade travel and airline stocks

With Webjet now in a stronger financial position, are you bullish or bearish on the company’s prospects? Either way, you can trade Webjet and other travel and airline stocks – long or short – through IG’s world-class trading platform now.

For example, to buy (long) or sell (short) Qantas using CFDs, follow these easy steps:

  • Create an IG Trading Account or log in to your existing account
  • Enter ‘QAN’ or ‘Qantas’ in the search bar and select it
  • Choose your position size
  • Click on ‘buy’ or ‘sell’ in the deal ticket

This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

Act on share opportunities today

Go long or short on thousands of international stocks with CFDs.

  • Get full exposure for a comparatively small deposit
  • Trade on spreads from just 0.1%
  • Get greater order book visibility with direct market access

See opportunity on a stock?

Try a risk-free trade in your demo account, and see whether you’re on to something.

  • Log in to your demo
  • Try a risk-free trade
  • See whether your hunch pays off

See opportunity on a stock?

Don’t miss your chance – upgrade to a live account to take advantage.

  • Trade a huge range of popular stocks
  • Analyse and deal seamlessly on fast, intuitive charts
  • See and react to breaking news in-platform

See opportunity on a stock?

Don’t miss your chance. Log in to take advantage while conditions prevail.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Friday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.