It's been a slow day for the S&P/ASX 200 Index (ASX: XJO) this Thursday. After recovering over the past two trading days, the ASX 200 is presently taking a backward step, down 0.26% at the time of writing. But let's talk about what's going on with Webjet Ltd (ASX: WEB) shares.
Sure, the ASX 200 is ticking down today, but Webjet shares are plunging. The ASX 200 travel stock closed at $8.48 a share yesterday afternoon. This morning, those same shares opened at $8.47 but quickly started dropping soon after. At the time of writing, the company is down a nasty 2.42% at $8.28 a share.
It hasn't been a great day for most ASX travel shares so far this Thursday. For example, Corporate Travel Management Ltd (ASX: CTD) and Qantas Airways Ltd (ASX: QAN) shares are both trading lower by more than the broader market.
But Webjet seems to be getting singled out for particularly heavy punishment.
A new ASX announcement out of the company might be the culprit here.
Webjet shares in separation talks
This morning, Webjet released an ASX filing that gave investors an update on the company's proposed demerger and separation of its two leading travel divisions.
The company first flagged this potential demerger back in May during its full-year earnings announcement. The split would see Webjet spin off its B2C businesses (including Webjet OTA, GoSee and Trip Ninja) as a separate ASX share, with the company's original ASX listing comprising Webjet's B2B 'WebBeds' division.
In June, Webjet followed up by declaring that its board "sees significant value enhancement through a potential separation of our two industry-leading businesses and brands."
Today's update builds on this progress by revealing that the company is going full-steam ahead on the demerger. Webjet has announced it will convene an extraordinary general meeting of shareholders on 17 September next month so that investors can cast a vote on the finalised demerger plans.
These plans will see Webjet's investors receive a 'demerger dividend'. New B2C shares will be distributed to eligible shareholders on a one-for-one basis, who will then own shares of both companies.
The old Webjet shares will then reportedly be renamed to 'WEB Travel Group Limited'.
Webjet's board has unanimously recommended that shareholders vote in favour of this proposed demerger. However, judging by the company's share price performance so far this Thursday, it's possible that at least some investors aren't entirely on board with this proposal.
Let's see what happens at the extraordinary general meeting next month.
Despite today's falls, the Webjet share price remains up a healthy 11.8% year to date in 2024.
