Airline IPOs tap investor expectations of post-pandemic rebound

Airline IPOs are taking off, fuelled by a jump in investor appetite for stocks expected to get a big lift from economic reopenings and an anticipated rebound in travel as Covid-19 vaccination programmes accelerate. Investors on Wall Street sent shares of Apollo-backed Sun Country Airlines up more than 50% in their debut on Wednesday, which came weeks after Norwegian start-up carrier Flyr listed in Oslo. It is shaping up to be one of the busiest two months in years for airline listings, with Frontier Airlines set to go public on the Nasdaq in the coming weeks. Sun Country’s shares closed their first trading session at $36.38 on Wednesday, giving the company a market value of around $2b. That was well above the $24 the shares were initially priced at on Tuesday and higher than the $21 to $23 range the Minneapolis-based budget airline had originally sought for its listing. The offering was roughly 15 times subscribed, according to people familiar with the deal. Both Sun Country and Frontier are going public after a challenging year. Frontier booked a net loss of $225m last year, after earning $251m a year prior. Sun Country was able to retain more than half of its 2019 operating revenue throughout the past year, owing in large part due to a deal to fly cargo for Amazon. The decline in bookings nonetheless left it with a $4m loss. <br/>