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Singapore Airlines: Raising Capital During COVID-19
內容大綱
On March 26, 2020, Singapore Airlines was reeling from the impact of the COVID-19 pandemic. To raise badly needed capital, it announced that its shareholders would be offered S$5.3 billion worth of rights shares and S$3.5 billion of rights mandatory convertible bonds, both of which would be reflected as equity on its balance sheet. Should shareholders take advantage of this offer or not? To make this decision, investors had to analyze the airline’s reasons for choosing this form of equity financing, the impact of this capital-raising exercise, Singapore Airline’s valuation, and the role of sovereign wealth funds in equity financing. Investors would have to decide the appropriate response to the rights issuances.
學習目標
This case can be used in an advanced undergraduate or graduate-level course on corporate finance or financial management. Students will have the opportunity to study alternative sources of funding in a pandemic, evaluate the pandemic’s impact on a firm’s capital structure, and conduct a valuation exercise.