American Airlines Issues $512 Million of Debt Backed by PlanesSarika Gangar
AMR Corp.’s American Airlines Inc., the bankrupt carrier that plans to merge with US Airways Group Inc., sold $512 million of debt backed by airplanes.
The company issued 5.6 percent, Class B certificates with an expected July 2020 maturity, according to data compiled by Bloomberg. The notes will rank junior to the $1.4 billion of 4.95 percent, Class A securities sold in July, which are secured by the same pool of planes, according to a report today from Fitch Ratings.
The new debt is expected to be rated B+ by Standard & Poor’s and graded one level lower at B by Fitch Ratings, Bloomberg data show.
The series 2013-2B enhanced equipment trust certificates will be secured by 75 of American’s Boeing aircraft, comprising 41 737-823 models, 14 757-223 planes, 19 777-223ER aircraft and one 767-323ER plane, the Fort Worth, Texas-based company said today in a statement. The aircraft make up about 12 percent of AMR’s total fleet, according to Fitch.
Proceeds will be used for general corporate purposes, the company statement said.