AEGEAN Airlines ready to buy back shares from the Greek state

AEGEAN Airlines

AEGEAN Airlines on Monday announced that the Hellenic Republic submitted a notification of its intention to exercise the rights granted by all the Warrants it holds on the company's shares on November 3, 2023.

In a statement, the president of AEGEAN, Eftichios Vassilakis, favoured buying back these rights, which will cost 85.4 million euros, stating: "AEGEAN has both the liquidity and the funds for their acquisition."

More specifically, the Chairman of the Board of Directors, Eftichios Vassilakis, stated:

"As announced, we received the Greek State's letter of intent to exercise the warrants. We have repeatedly stated that AEGEAN has both the liquidity and the funds to buy them out. My proposal to the Board of Directors and to the General Assembly of shareholders (which will take the final decisions), will be for the Company to proceed with the acquisition of the rights by the Greek State, paying the amount of 85.4 million euros.

"In this way, the last part of the particularly painful cycle of the pandemic will end, from which the Company is, however, emerging stronger in all areas with the assistance of its shareholders, its employees and also the passengers who choose us every day in 165 destinations.

"We thank the state for supporting us during this unprecedented time and we continue with development and investments of even higher added value and contribution to the country's economy, capabilities and infrastructure."

It is reminded that the European Commission approved on December 23, 2020 a Greek grant of 120 million euros, aiming at compensating part of the Company's losses directly caused by the COVID-19 pandemic in 2020.

Following the European Commission's approval, two additional prerequisites for the grant disbursement were provisioned by the Hellenic Republic under article 30 of Law 4772/2021 as follows:

Α. the obligation of the Company's private shareholders to participate in a share capital increase, aiming to raise at least 60 million euros, and

Β. the obligation of the Company to issue and grant without consideration Warrants to the Hellenic Republic, which give the right to acquire the Company's shares at an exercise price equal to the price of aforementioned share capital increase.

The share capital increase, through which funds of 60 million euros were raised, was completed on June 14, 2021, at a price of 3.20 euros per share, followed by the disbursement of the grant of 120 million euros on July 2, 2021.

Thereby, the exercise price of the Warrants in accordance with article 30 of Law 4772/2021 was set at 3.20 euros, ie equal to the price of the required share capital increase, with the exercise period beginning on July 2nd 2023 and ending on July 3rd, 2026. Each of the 10,369,217 Warrants give the right to the Hellenic Republic to acquire one new common registered share of the Company.

The Hellenic Republic notified the Company of their intention to exercise the rights granted by all the Warrants held on the Company's shares on November 3rd, 2023. If the exercise is completed, the Hellenic Republic through the payment of 33.2 million euros will acquire new shares, representing 10.3% (on a fully diluted basis) of the Company's share capital, thus diluting the stakes of the Company's existing private shareholders accordingly.

The Company, in accordance with article 30 of Law 4772/2021 and the terms of the Warrants, within sixty (60) calendar days from the date of receipt of the notice to exercise the Warrants (3/11/2023), has the right to respond on whether it is willing to exercise its right to buy back the Warrants from the Hellenic Republic by paying their value.

The value of the Warrants is determined by the positive difference of the volume weighted average share price of the Company sixty trading days preceding the notification and the exercise price.

The volume weighted average share price 60 trading days prior 3/11/2023 is calculated at c 11.43 euros per share (as it is required to be determined by an independent financial advisor).

Consequently, if the Company decides to buy back the Warrants it will need to pay Hellenic Republic 8.23 euros per warrant, ie 85.4 million euros for the total of 10,369,217 Warrants.

In view of the above, the Company's Board of Directors will proceed in the immediate future with all actions required and is planning to call an Extraordinary General Meeting of Shareholders so as the Company can take the necessary decisions and execute them within the required deadlines as provisioned in the terms of the Warrants and with a target of completion within the current year.

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