American Airlines upsizes term loan to $1 billion, trims discount

By Paul A. Harris

Portland, Ore., April 27 – American Airlines Group Inc. upsized its seven-year term loan B (Ba1/BB+) to $1 billion from $750 million, a market source said on Wednesday.

In addition to the upsizing, price talk richened to 99.25 from 99.

Commitments were due on Wednesday.

Unchanged were the 275 basis points spread to Libor, the 0.75% Libor floor and the six-month 101 soft call protection.

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.

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

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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