The takeover of Air Mauritius (MK) is complete and the carrier has officially withdrawn from the country’s stock exchange.
The airline, which exited administration in September 2021, has been fully taken over by parent Airport Holdings Ltd (AHL), although some shareholders had wanted to halt the process.
The Board of Air Mauritius Limited released a statement on the airline’s website addressing the halting of its trading activity on the exchange to its “shareholders and the public at large.”
“Following the compulsory acquisition of the shares of the dissenting shareholders of Air Mauritius Limited in accordance with Rule 39 of the Takeover Rules by Airport Holdings Limited, Air Mauritius Limited will no longer meet the requirements of the Listing Rules for its listing on the official market,” said the airline’s board.
Airport Holdings Limited, the parent company of Air Mauritius, made an offer to the shareholders of MK on October 15, 2021 to acquire all the voting shares at a price of Rs 5.80 ($0.13) per share.
According to a statement from the airline, the offer to purchase all the voting shares followed a transaction on October 13, 2021 where Airport Holdings Limited acquired 9,429,896 shares in Air Mauritius Holding Ltd from the State Investment Corporation Limited and Rogers and Company Limited.
Within the rules of the Stock Exchange of Mauritius (SEM), any person, either individual or together acting with a person in concert, acquiring effective control of a company (50% or more shares) is required to make a mandatory offer for all voting shares not already held by the offeror.
However, AHL’s takeover was met with some resistance from smaller shareholders.
During a press conference in October 2021, the Listed Companies Minority Shareholders Association (LCMSA) urged shareholders to refrain from selling their shares to AHL.
The President of the association, Awadh Balluck, stated that smaller shareholders were being forced to sell their shares at a ridiculous price.
“What is happening with Air Mauritius is that it is rushing into a pattern that goes towards opacity, towards non-accountability to shareholders and the people. State money is people’s money,” stated Balluck according to local media.
Balluck added: “This is contrary to the democratization of investment. Now, no one will be able to question the management of MK, because before it was the small shareholders who raised questions. From now on, the people will not know what is happening in MK.”
Balluck, who held shares in the airline for nearly 30 years, claimed that while AHL intends to purchase the shares at Rs 5.80, he purchased his shares at Rs 30.
“We will stand up. As a matter of principle, we are not going to sell,” stressed Balluck, pointing to the fact that he would wait for the end of the period without giving in.
However, the Listing Rules of SEM state that if a company succeeds in acquiring more than 90% of shares in the company, it can send a check to remaining shareholders to inform them that it has purchased their shares.
Air Mauritius Limited therefore officially withdrew from the Stock Exchange of Mauritius on March 31, 2022.
The Board further approved that “it will not restore the percentage in public hands of Air Mauritius Limited to 25% pursuant to the Listing Rule 6.21.”
The Mauritian flag carrier exited administration in late September 2021 after halting operations for about 19 months due to the impact of the COVID-19 pandemic on air travel. The airline’s operations restart followed a 12 billion Mauritian rupees ($280 million) injection from the government, to help the carrier achieve long term stability.
The airline restarted operations with a fleet of nine aircraft, down from 15 aircraft before the restructuring. The fleet now comprises four Airbus A350-900s, three ATR72-500s, and two Airbus A330-900neo aircraft.
In its statement regarding the delisting Air Mauritius also said it would publish results for the last two financial years (to end March 2020 and end March 2021) by October 31, 2022.”