Online travel company Webjet has scrapped plans for a $250 million equity raising after failing to find sub-underwriting support for the hefty retail component.
It is understood Webjet's board decided to pause the raising plans on Wednesday night, after the company and its brokers spent three days pitching the offer to funds.
While institutional shareholders were likely to have taken up their component of the equity raising to help save the company, there were concerns about the retail offer.
About half of Webjet's shares on issue are in the hands of retail investors, and potential sub-underwriters were understandably gun shy given market conditions and the company's situation.
Instead, Webjet's believed to be going down the alternate route and seeking to lock in a rescue funding package lobbed by a private equity firm.
The package is understood to be a convertible debt instrument lobbed by private equity giant KKR, as Street Talk reported earlier this week. If Webjet can finalise terms with KKR, it would go back to shareholders with a smaller equity raising.
It means it could be another few day before Webjet, which is advised by Goldman Sachs and had Credit Suisse and Ord Minnett assisting with the raising, knows what its future looks like.
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