York to invest EUR 38.8 million of fresh capital into SkyEurope

SkyEurope Holding AG has signed an agreement with York Global Finance II under which York will invest EUR 38.8 million of fresh capital into SkyEurope as part of a comprehensive EUR 56.3 million equity and equity-linked financing package.

The transaction will include several elements:

- Existing and new shareholders will have the opportunity to purchase 10 million new shares of SkyEurope via a rights issue, at a fixed price of EUR 1.75 per share, pursuant to the approvals received from shareholders at the General Meeting held on 20 June 2006. 

- York will purchase approximately 9 million new shares also at a fixed price of EUR 1.75 per share.  York will own approximately 23 percent of SkyEurope’s pro forma shares outstanding after the issuance of such shares and the rights offering are completed.

- York will purchase approximately EUR 6.7 million of bonds mandatorily convertible into an additional approximately 3.8 million new shares of SkyEurope upon receipt of various regulatory approvals.  Receipt of such approvals and conversion are expected to occur within six months, during which time the bonds
will not bear interest. If such conversion takes place, York’s pro forma equity stake in SkyEurope will rise to 29.9 percent.

- York will purchase a further EUR 17 million nominal amount of non-mandatorily convertible bonds, with net proceeds to the Company of EUR 16.4 million.

Christophe Aurand, chief executive officer, York Capital Management UK Advisors Limited, said, “York believes SkyEurope is strategically positioned in highly attractive emerging European markets which offer significant growth opportunities not available in most parts of the world.”

“Additionally, SkyEurope’s low cost and entrepreneurial business model enables a product and service offering superior to its competitors.  We are excited to work with the management and employees of SkyEurope and to contribute to the strategic development and profitable growth of the company,” said Aurand.