Corporate Travel Management Ltd (ASX: CTD) shares are currently in a trading halt.
What’s going on?
The travel industry has been heavily impacted by COVID-19, restrictions and impacts. The Corporate Travel share price is still down 27% from 20 January 2020. However, its share price is actually higher now than it was on 21 February 2020 (which is when the crash started). Corporate Travel sees this period as an opportunity.
In the trading halt announcement it said that it’s “considering, planning for, and expecting to announce, a capital raising comprising an underwritten pro rata accelerated entitlement offer” of shares to fund an acquisition which will be announced at the same time as the offer is announced.
Corporate Travel will be in a trading halt until it releases an announcement about the outcome of the institutional component on the offer, or the commencement of trading on 1 October 2020, whichever is first.
According to the AFR, the capital raising is expected to be worth about $400 million with Morgan Stanley and Morgans overseeing the raising. The acquisition is reported to be “company changing”.
I’m not sure if Corporate Travel is a buy today. There is still a lot of uncertainty when it comes to COVID-19. Will Zoom replace in-person meetings? There are other ASX growth shares I’d rather buy first like Pushpay Holdings Ltd (ASX: PPH).
