Romania's Blue Air plans London debut

Low cost carrier Blue Air is planning to debut on the London Stock Exchange and is expected to fetch a valuation of up to £500m.

The Romanian airline, which is owned by entrepreneur Christian Rada, will list via a reverse takeover of Aim-listed cash shell Ridgecrest.

The Times reported that the airline is expected to be valued at up to £500m, and is looking to raise up to €250m, initially through the issue of convertible bonds and then via new shares.

Blue Air is headquartered in Bucharest with additional operations at Turin airport in Italy. Founded in 2004, it is the country’s largest carrier by scheduled passengers flown with a route network encompassing most major European capitals and with daily flights between London and Bucharest.

The airline was profitable prior to the pandemic; in the 12 months to 30 September 2019, pre-tax profits were €6.75m. Last August, the European Commission gave the Romanian government the green light to lend Blue Air up to €62m, to compensate it for the pandemic and provide “urgent liquidity support”.

It currently has a fleet of 15 aircraft but is looking to expand that to around 50 within five years, The Times reported.

Shares in Ridgecrest have been suspended since the intended RTO was announced.

However, completion of the deal is reliant on a number of factors, including due diligence, the completion of a fund raising by Blue Air and the approval of Ridgecrest shareholders.

Ridgecrest – which will be renamed Blue Air Group should the deal go ahead – added: “It should be noted that the proposed transaction is at a preliminary stage and there can be no guaranteed that it will complete, nor as its final terms.”

Should no deal be competed within six months, Ridgecrest’s shares will be cancelled from trading on Aim, in line with the junior market’s rules.