Airline to offer its stock to public

Allegiant Air, the airline that begins flying from Roanoke to Orlando, Fla., on May 24, said Tuesday it plans to raise money through a public stock offering.

Aviation consultant Tim Sieber at The Boyd Group said the move appeared to be good news for Las Vegas-based Allegiant, which announced on March 28 that it would start flying from Roanoke to Orlando on Wednesdays and Saturdays.

Its fares for Roanoke now range from $89 to $199.

"One thing you can never have enough of is money," said Sieber, based in Evergreen, Colo., after Allegiant announced its initial public stock sale.

"From that perspective I think it's a good move" by Allegiant. "I went through their papers last night and it looks like they're sitting on about $53 million in cash. That's not a bad amount of money for the size of airline they are, but it's not a great amount.

"This gives them some cushion that would allow them to weather some rough times, if that happens, and provides some capital to grow the business and make sure it's sustainable," Siebert said.

A filing with the Securities and Exchange Commission said the initial offering could be worth as much as $100 million.

The number of shares, their price and when they will become available were not disclosed. Proceeds will be used to buy aircraft and for general corporate purposes, the filing said.

Allegiant currently does not fly from Roanoke to Las Vegas because its 150-seat jets can't handle the distance, said Allegiant spokeswoman Tyri Squyres. Allegiant flies the twin-engine MD-80 series of planes, Squyres said.

The shares are expected to be listed on the Nasdaq Stock Market under the symbol ALGT. The offering will be made through an underwriting syndicate led by Merrill Lynch & Co.

Allegiant posted net income of $7.3 million for 2005, down from $10.3 million a year before.

Allegiant was the fastest-growing airline at Las Vegas' McCarran International Airport last year. Its passenger arrivals and departures nearly doubled from January 2005 through the same month this year, to 96,000.

Siebert said growth by the company might be based on its successful model in Las Vegas. "The jury is still out on how successful Orlando is going to be," he said.

The demographics for people flying to Vegas and its 24-hour lifestyle are different from Orlando's family theme parks, Siebert said.

Allegiant's flights from Roanoke will depart at 6 p.m., arriving in Orlando Sanford International Airport at 7:50 p.m. Flights leaving Orlando depart at 3:40 p.m., and arrive in Roanoke at 5:25 p.m.