WestJet share issue raises speculation of a planned acquisition

WestJet announced plans to raise up to CAD172.5 million (USD160 million) in a share issue to help it fund future aircraft financing activities and for “general corporate purposes”. The unexpected share issue, which will reportedly dilute the carrier’s shares by approximately 12%, has fuelled speculation that WestJet is readying for its first acquisition. WestJet had a healthy cash balance of USD687 million as at Jun-2009. [1005 words]

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This report contains the following subheadings:

• Seeing continued yield weakness, but no further declines in demand
• Slows fleet and growth plans 
• Continues to gain market share from rival
• Southwest codeshare expected to be completed by 2010

This report contains the following charts and tables:

• WestJet share price growth: Jan-2009 to Sep-2009
• WestJet traffic highlights: Aug-2009
• WestJet fleet plan: Sep-2009