KUALA LUMPUR: Shares of AirAsia Bhd climbed in early Monday trade as investors were positive about the corporate proposal to place out new shares to the founders to raise RM1bil.

At 9.04am, the low-cost carrier was up four sen to RM1.87 with 6.57 million shares done.

The FBM KLCI was up 0.22 of a point to 1,710.77.

AirAsia Bhd plans to issue 559 million new shares at an issue price of RM1.84 per share to Tune Live Sdn Bhd, which is controlled by the founders Tan Sri Anthony Fernandes and Datuk Kamarudin Meranun.

AirAsia had then said the subscription shares account for 16.7% of its enlarged issued and paid-up share capital. 

CIMB Equities Research was positive on the plan as firstly, the founders are willing to put in additional cash at the existing undiscounted share price, which suggests that they believe AirAsia is worth much more. 

Second, that they will raise their stake from 18.9% to 32.4%, meaning that they will have even greater commitment and incentive to “make it work”, said the research house.

CIMB Research raised the target price to RM2.70 from RM2.43.

http://www.thestar.com.my/business/business-news/2016/04/04/airasia-flies-higher-on-rm1b-share-placement/