Delta increases frequent flyer-backed debt sale to $9 billion

The nose of a Delta Air Lines Boeing 777-200ER dedicated to David C. Garrett Jr, former CEO of the airline is seen at the Narita airport.

Fabrizio Gandolfo | SOPA Images | Getty Images

Delta Air Lines is raising $9 billion in a massive debt sale backed by its frequent flyer program, the latest large offering by an airline grappling with the coronavirus pandemic’s impact on travel demand.

The amount is nearly 40% more than the $6.5 billion Delta said earlier this week it intended to raise. The Atlanta-based carrier is burning about $27 million a day as the pandemic continues to sap travel demand, CFO Paul Jacobson said at an investor conference last week.

Airlines are increasingly turning to their loyalty programs to raise cash after revenue from air travel dropped sharply this year. United Airlines is using its MileagePlus program to back new debt, while American Airlines plans to use its AAdvantage program as collateral for a government loan. 

Delta shares were down 1.3% in morning trading.

Source link




Investors react to Fed Chair Jerome Powell’s testimony

An electronic board displays stock information at the Australian Securities Exchange, operated by ASX Ltd. on March 16, 2020 in Sydney, Australia.Brendon Thorne...

2020 Buick Electra electric concept car unveiled in China

Buick plans to broaden its range of electric cars in the coming years, and it still owns the rights to the heritage-laced Electra...

Why Wall Street thinks flying taxis can replace helicopters

Archer AirSource: Archer AirThe current bull market in stocks has fueled concerns about speculation in too many offerings and unproven technologies, but don't...

Stock futures tick higher as pressure on tech stocks pauses

Traders on the floor of the New York Stock ExchangeSource: NYSEFutures contracts tied to the major U.S. stock indexes inched higher at the...

Foundation of China’s economic recovery ‘not yet solid,’ leaders say

Workers make protective masks at a factory in Handan, Hebei province, China January 22, 2020.China Daily via REUTERSBEIJING — Chinese leaders warned at...