MIAMI – Sun Country Airlines (SY) stock jumped 40% on its first day of trading on Wednesday, indicating high investor interest in airline stocks.
Sun Country said late Tuesday it had sold nearly 9.1 million shares at US$24 each (US218m in total), according to CNBC. Last week, the Minneapolis-based airline forecasted a share price of US$21 to US$23 for the stock. At midday on Wednesday, the stock was trading at US$34. On the Nasdaq Global Select Market, they debuted with the ticker “SNCY.”
Back on February 10, the Minneapolis-based ULCC announced it would look to raise USD$100m during the initial public offering.
Since Mesa Air Group went public in 2018, the Apollo Management Group-backed airline is the first US carrier to go public. According to Dealogic, it is also the largest US airline IPO since Virgin America’s in 2014, CNBC reports.
Money Raised to Pay Debts
Sun Country specializes in leisure travel with more than 50 destinations in the US, Caribbean, Mexico, and Central America from its hub in Minneapolis-Saint Paul (MSP). SY’s fleet is composed of 29 passenger aircraft, all 737-800 at 186 economy seats, as well as 13 737-800F mainly dedicated to Amazon.
According to Bloomberg, the airline plans to use the money to repay debts with the remaining part to be used for corporate needs. SY, which was acquired by Apollo Global Management in 2018, has lost US$4m in 2020 against a positive result of US$ 46m compared to 2019. In 2020 revenue decreased by US$300m.
Featured image: Sun Country B737-800 N821SY – Photo : Mateo Skinner/Airways