IPO to net Ryan family millions

THE family of late Ryanair co-founder and aviation entrepreneur Tony Ryan is set to make tens of millions of euro as its share in Asian low-fares airline, Tiger Airways, is diluted after the company’s planned partial flotation later this month.

Tiger – headquartered in Singapore – is planning to list 30% of its share capital in order to raise extra capital to fund the expansion of its fleet and pay off debt and formally began its investor roadshow yesterday.

The Ryan family – led by Mr Ryan, who died in 2007 – invested in Tiger in 2003, a year before its first commercial flight. Currently, the family’s interests in the airline – via the RyanAsia holding company – amount to a 16% stake. This stake among others – Singapore Airlines is another major shareholder in the company with a 49% stake – are likely to be diluted post-float.

The Ryan stake is held by various family members and a number of executives of Irelandia, the investment company headed up by the late Mr Ryan’s son, Declan, a former board member of Ryanair and still a significant shareholder in the Irish airline. It was reported last year that RyanAsia’s stake in Tiger is worth about $160 million (€111m).

The proposed public offering by Tiger marks the first aviation listing in Asia for nearly five years and is set to start a number of similar moves. Budget airline Lion Air, which is based in Sri Lanka, and the Indonesian national carrier, Garuda are both aiming to go to market this year. Indian airline, Jet, was the last Asian-based aviation company to float, in early 2005.

Asian-based analysts have warned recently that some of the continent’s airlines – particularly the lower-budget practitioners – have ordered too many planes and too little demand exists for them to sustain the additional capacity. Tiger’s IPO has already been downsized – from a target of raising around $500m to nearer the $300m to $350m mark. That said, early signs from Tiger’s investor roadshow this week are understood to be broadly positive.

The Singapore-based airline has a fleet of 17 Airbus A-320 aircraft and orders for another 55 of the same model, which are due to be delivered over six years.

Tiger made losses of Sing$50.8m (€25.3m) in its last full year (up to the end of last March), but had been profitable in 2007.