Minneapolis-based Sun Country is planning on going public, and the timing sure is going to raise some eyebrows…
Sun Country’s plans to go public
Sun Country has filed with the US Security and Exchange Commission relating to a proposed initial public offering (IPO) of its common stock, as the airline hopes to raise at least $100 million through this. Sun Country is owned by Apollo Global Management, which is a huge global asset management firm.
Sun Country intends to trade on Nasdaq with the ticker symbol “SNCY.” The number of shares offered and the price range of the proposed offering has not yet been determined.
Plans for Sun Country to go public predate the pandemic, as Sun Country had already been discussing this in mid-2019, with plans to go public in April 2020.
Understandably the IPO was put off, since that would have been terrible timing unless the company’s financial situation was truly dire. While airline stocks have recovered considerably, it’s still interesting that Sun Country thinks now is a good time for an IPO.
Sun Country has been quite resilient
Since Sun Country isn’t publicly traded, we don’t have quite as much information about the carrier’s performance compared to peers. However, by all accounts the airline seems to be doing relatively well:
- Sun Country was allegedly profitable in the summer of 2020
- Sun Country operated as many flights in October 2020 as in February 2020
- Sun Country has been successful during the pandemic with charters for sport teams and casinos, and the company has also started operating cargo services for Amazon
In 2017, Sun Country underwent a significant transformation, as the airline went from a full service airline to an ultra low cost airline. With this, Sun Country eliminated first class, crammed more seats into planes, started charging for carry-ons, and more.
While consumers were mostly sad to see this transformation, ultimately it seemed to work out quite well for the airline financially.
Sun Country intends to go public, as the airline hopes to raise at least $100 million through its IPO.
Based on what we know, Sun Country has been rather resilient and creative throughout the pandemic, between its charters and its Amazon cargo business. Sun Country significantly adjusted its business model in 2017, and that has worked out quite well.
Nonetheless it seems like a gutsy time for an airline to go public, so this will be worth watching. Perhaps Sun Country thinks that its relative success compared to other airlines during these tough times makes it a good time to go public.
What do you make of Sun Country’s planned IPO?