American Airlines launches $750 million term B at Libor plus 275 bps

By Sara Rosenberg

New York, April 18 – American Airlines Group Inc. launched on Monday its $750 million seven-year term loan B (Ba1/BB+) with price talk of Libor plus 275 basis points with a 0.75% Libor floor and an original issue discount of 99, according to a market source.

The term loan B has 101 soft call protection for six months, the source said.

Covenants include minimum unrestricted liquidity of $2 billion and a minimum collateral coverage ratio of 1.6 times.

Barclays, Bank of America Merrill Lynch, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman Sachs Bank USA, J.P. Morgan Securities LLC, Morgan Stanley Senior Funding Inc., BNP Paribas Securities Corp., Credit Agricole, ICBC and U.S. Bank NA are the bookrunners on the deal.

Commitments are due at 5 p.m. ET on April 26.

Proceeds will be used to repay the company’s $588 million term loan B-2 due in 2016, to pay related fees and expenses and for general corporate purposes.

Net debt to EBITDAR is 2.4 times, the source added.

American Airlines is a Fort Worth, Texas-based airline company.

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