AirTran Raises Much Needed Cash (AAI)

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AirTran Holdings Inc. (NYSE: AAI) has priced $65 million a 5 1/2% convertible Senior Notes due 2015.  The company is also given underwriters a 30 day overallotment option for $9.75 million additional in notes.  Morgan Stanley was the lead underwriter and Credit Suisse served as co-lead manager. The equivalent conversion price is $3.84 per share.

The airline has concurrently priced 22.3125 million shares of its common stock price of $3.20 per share.  Underwriters have been granted more than 3.3 million shares as an overallotment option.

AirTran has a market cap of $294 million and shares closed at $3.20.  While the company lost $35 million last quarter, it had over $360 million in cash and equivalents at the end of 2007.

As you can see by their wide trading range of $3.13 to $12,65, they are also not immune from high oil prices and a tightening economy.

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Jon C. Ogg
April 25, 2008