Delta wraps up financing deal
The Atlanta Journal-Constitution
Delta Air Lines announced it has completed $2.1 billion in financing deals, allowing it to generate extra cash and refinance debt from merger partner Northwest Airlines.
Fitch Ratings in a report earlier this year said Atlanta-based Delta’s declining cash balances could make it difficult to repay debt without better access to financing.
The deals, first announced earlier this month and secured by Delta’s Pacific route authorities, slots and gate leases, allowed Delta to refinance $1.5 billion of Northwest’s debt and generate an additional $600 million in available funds.
The transactions involve bonds sold through Barclays Capital, Citibank, Deutsche Bank, Goldman Sachs, JP Morgan, Morgan Stanley and UBS Investment Bank, according to Delta.
With the deals, Delta said it has refinanced more than 40 percent of its debt due in 2010. It now expects to have $5.6 billion in unrestricted liquidity at the end of September, up from $5 billion at the start of the month.
Separately, Delta and other airlines have reportedly been in talks about making an investment of several hundred million dollars in struggling Japan Airlines.
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