Jump to content

Air Canada Plans $900M Private Offering


Recommended Posts

Air Canada plans $900-million private offering to repay credit facility

Scott Deveau, Financial Post · Tuesday, Jul. 20, 2010

Air Canada said Tuesday it plans to issue $900-million in senior secure notes through a private offering in order to repay the credit facility it received from a number of players, including the federal government, last summer while it was struggling to avoid a bankruptcy filing.

The airline said the notes would be due 2015 and be issued in a series denominated in both U.S. and Canadian dollars, subject to market and other conditions.

“Air Canada intends to use the net proceeds for the repayment of all indebtedness under Air Canada's secured term credit facility entered into in July 2009 and would use any remaining net proceeds for general corporate purposes,” the company said in a statement.


Read more: http://www.financialpost.com/news/Canada+plans+million+private+offering+repay+credit+facility/3299334/story.html#ixzz0uE77pHb2

Link to comment
Share on other sites

International growth between 6 and 7.5%? Other than the already announced YVR-FRA route for next year...where else is this growth coming from or is that the China growth?

Thoughts :Scratch-Head:

AC has not officially announced YVR-FRA route yet. What AC equipment is operating this route and will LH continue with their daily flight?

Link to comment
Share on other sites

  • 2 weeks later...

Air Canada has smooth flight

Thursday July 29, 2010 - Financial Post

Barry Critchley

They went looking for $900-million of high-yield debt and ended up with $1.1-billion on more attractive terms than their previous $700-million credit facility.

By any measure, that transaction by Air Canada is a major success. Not only did the issuer raise more capital, it did so on more attractive terms. The blended interest rate on the new borrowings is just over 10%, which compares favourably with the minimum 12.75% required under the facility put in place last July with four non-bank lenders. And the issuer has also been able to extend term. The $700-million fully drawn facility was set to mature in July 2014; now the bulk of the issue won't have to be paid off until August 2015.

"It was a very interesting and successful deal," said one market participant, who added Air Canada made a little history with the collateral used to support the borrowings. The deal marks the first time a Canadian airline has been able to use its Pacific route rights and gate slots (at La Guardia and Heathrow as collateral) for a capital markets borrowing. (Other assets, including real estate, were also used as part of the $2-billion collateral.)

'Air Canada was also blessed with good timing'

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Create New...