American to sell more than $1.5B in shares, borrows $500M
American Airlines (AAL) announced proposed underwritten public offerings of $750,000,000 of shares of its common stock and $750,000,000 aggregate principal amount of its convertible senior notes due 2025.
The company intends to grant the underwriters of the offerings a 30-day option to purchase, in whole or in part, up to $112,500,000 of additional shares of Common Stock in the Common Stock Offering and a 30-day option to purchase, in whole or in part, up to $112,500,000 aggregate principal amount of additional Convertible Notes in the Convertible Notes Offering, in each case solely to cover over-allotments, if any.
The company expects to use the net proceeds from the Common Stock Offering and the Convertible Notes Offering for general corporate purposes and to enhance the company’s liquidity position.
The company also announced it intends to enter into a new $500M Term Loan B Facility due 2024 concurrently with the closing of the offering of the Notes.
The company expects to use a portion of the net proceeds from the offering of the Notes and borrowings under the Term Loan to refinance its delayed draw term loan facility which the company and the Guarantor entered into on March 18, 2020 and is scheduled to mature on March 17, 2021, with the remainder for general corporate purposes and to enhance the company’s liquidity position.
AAL closed at $16.00.
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