Delta Air Lines seeks $3bn in bonds, loan amid air travel halt

Bloomberg

Delta Air Lines Inc is seeking to raise $3 billion from loans and bonds as it grapples with a global travel shutdown caused by the coronavirus pandemic.
The company is offering a $1.5 billion first lien term loan due 2023 and the same amount in senior secured bonds maturing in 2025, it said in a statement.
The debt, which will help boost liquidity, will be secured by collateral including domestic slots at New York airports and those at Heathrow in London as well as other European and Latin American routes, it said.
Barclays Plc was expected to hold a lender call for the loan on Thursday, according to people familiar with the matter. Commitments are due April 28, the people said. JPMorgan Chase & Co. will lead the private bond offering.
Delta’s borrowing plans come after United Airlines sold more than $1 billion in stock at $26.50 a share — a low price and the first such offering by a major US airline during the pandemic. Delta, which is already stepping up cost cutting efforts, obtained a $2.6 billion one-year loan from JPMorgan last month and has drawn $3 billion under its existing credit lines.
Delta Chief Financial Officer Paul Jacobson said on a call to discuss financial results that options for the airline included borrowing against $13.5 billion in unencumbered assets, or selling planes and leasing them back from the buyers. Delta has also applied for $4.6 billion in US government loans which if tapped, would complement the $5.4 billion in emergency US payroll support the company has already lined up.

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