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American Airlines Expects to Raise $3.5B in New Financing

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American Airlines Group Inc AAL revealed plans to raise $3.5 billion in new financing, to strengthen its liquidity position, as it battles the low-demand environment caused by the coronavirus pandemic.

The carrier will offer $1.5 billion in senior secured notes due 2025. It expects to enter into a $500 million term loan facility due 2024. Further, the airline will sell $750 million each in shares and senior convertible notes due 2025.
 
Goldman Sachs, Citigroup, BofA Securities and J.P. Morgan are acting as representatives of the underwriters for the stock and the notes offerings.

Earlier, American Airlines, carrying a Zacks Rank #3 (Hold), notified that its cash burn rate has decreased significantly, thanks to substantial reduction in costs and recent improvement in demand. From the high of $100 million per day in April, the carrier anticipates the cash burn rate to fall to approximately $40 million per day in June. Savings from cost-cuts, lower capacity and fuel prices have reduced operating and capital expenditures by more than $13.5 billion for 2020. With this and the modestly improving demand, the carrier hopes to reduce cash burn rate to zero by the end of this year. Delta Air Lines, Inc. DAL, carrying a Zacks Rank #4 (Sell), also hopes to reduce its average daily cash outflow to zero by the end of this year.

American Airlines Group Inc. Price

 

American Airlines Group Inc. Price
American Airlines Group Inc. Price

American Airlines Group Inc. price | American Airlines Group Inc. Quote


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Delta Air Lines, Inc. (DAL) : Free Stock Analysis Report
 
American Airlines Group Inc. (AAL) : Free Stock Analysis Report
 
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