Alaska Air Group Announces Pricing of Upsized Senior Secured Notes Offering
Alaska Air Group (ALK) has announced the pricing of a private offering of $1.25 billion in Senior Secured Notes and a $750 million senior secured Term Loan B. The offering, initially set at $750 million, was upsized to $1.25 billion. The notes, issued by AS Mileage Plan IP, , include $625 million of 5.021% notes due 2029 and $625 million of 5.308% notes due 2031. The proceeds will be used to fund reserve and collection accounts, with the latter funding an intercompany loan to Alaska Airlines. This loan will be used to redeem debt from the Hawaiian Airlines merger and for general corporate purposes. The financing is secured by collateral associated with Alaska's loyalty program and guaranteed by Alaska Airlines and other subsidiaries.
Alaska Air Group (ALK) ha annunciato la determinazione del prezzo di un'offerta privata di 1,25 miliardi di dollari in Note Senior Garantite e un prestito Term Loan B senior garantito da 750 milioni di dollari. L'offerta, inizialmente fissata a 750 milioni di dollari, è stata ampliata a 1,25 miliardi di dollari. Le note, emesse da AS Mileage Plan IP, includono 625 milioni di dollari di note con un tasso del 5,021% in scadenza nel 2029 e 625 milioni di dollari di note con un tasso del 5,308% in scadenza nel 2031. I proventi saranno utilizzati per finanziare i conti di riserva e di raccolta, mentre quest'ultimo finanzierà un prestito interaziendale ad Alaska Airlines. Questo prestito sarà utilizzato per riacquistare il debito derivante dalla fusione con Hawaiian Airlines e per scopi aziendali generali. Il finanziamento è garantito da garanzie associate al programma di fidelizzazione di Alaska e garantito da Alaska Airlines e altre sussidiarie.
Alaska Air Group (ALK) ha anunciado el precio de una oferta privada de 1.250 millones de dólares en Notas Senior Garantizadas y un préstamo Term Loan B senior garantizado de 750 millones de dólares. La oferta, inicialmente establecida en 750 millones de dólares, se amplió a 1.250 millones de dólares. Las notas, emitidas por AS Mileage Plan IP, incluyen 625 millones de dólares en notas con un interés del 5,021% con vencimiento en 2029 y 625 millones de dólares en notas con un interés del 5,308% con vencimiento en 2031. Los ingresos se utilizarán para financiar cuentas de reserva y de cobro, siendo estas últimas utilizadas para un préstamo interempresa a Alaska Airlines. Este préstamo se usará para canjear deuda de la fusión con Hawaiian Airlines y para fines corporativos generales. La financiación está asegurada con garantías asociadas al programa de lealtad de Alaska y garantizada por Alaska Airlines y otras subsidiarias.
알래스카 항공 그룹 (ALK)은 12억 5천만 달러 규모의 선순위 보장 채권과 7억 5천만 달러 규모의 선순위 보장 Term Loan B의 가격 책정을 발표했습니다. 처음에 7억 5천만 달러로 설정된 이 오퍼링은 12억 5천만 달러로 확대되었습니다. AS Mileage Plan IP에서 발행한 본 채권은 6억 2천5백만 달러의 5.021% 채권으로 2029년에 만기되며, 6억 2천5백만 달러의 5.308% 채권으로 2031년에 만기됩니다. 수익금은 예비 및 수금 계좌를 자금 지원하는 데 사용되며, 후자는 알래스카 항공사에 대한 내부 대출을 자금을 지원합니다. 이 대출은 하와이アン 항공사와의 합병으로 인한 부채를 상환하기 위해 사용되며, 일반 기업 용도로도 사용됩니다. 이 자금 조달은 알래스카의 로열티 프로그램과 관련된 담보에 의해 확보되며 알래스카 항공사 및 기타 자회사가 보증합니다.
Le groupe Alaska Air (ALK) a annoncé le prix d'une offre privée de 1,25 milliard de dollars en Obligations Senior Garanties et d'un prêt Term Loan B senior garanti de 750 millions de dollars. L'offre, initialement fixée à 750 millions de dollars, a été portée à 1,25 milliard de dollars. Les obligations, émises par AS Mileage Plan IP, comprennent 625 millions de dollars d'obligations à 5,021% arrivant à échéance en 2029 et 625 millions de dollars d'obligations à 5,308% arrivant à échéance en 2031. Les fonds seront utilisés pour financer les comptes de réserve et de recouvrement, ce dernier financera un prêt interentreprises à Alaska Airlines. Ce prêt sera utilisé pour racheter la dette liée à la fusion avec Hawaiian Airlines et pour des besoins d'exploitation générale. Le financement est garanti par des garanties associées au programme de fidélité d'Alaska et garanti par Alaska Airlines et d'autres filiales.
Die Alaska Air Group (ALK) hat die Preisgestaltung einer Privatplatzierung von 1,25 Milliarden Dollar in Senior Secured Notes und einem 750 Millionen Dollar Senior Secured Term Loan B angekündigt. Die ursprünglich auf 750 Millionen Dollar festgesetzte Platzierung wurde auf 1,25 Milliarden Dollar erhöht. Die von AS Mileage Plan IP emittierten Anleihen umfassen 625 Millionen Dollar von 5,021% Anleihen mit Fälligkeit 2029 und 625 Millionen Dollar von 5,308% Anleihen mit Fälligkeit 2031. Die Erlöse werden verwendet, um Reservierungs- und Inkassokonten zu finanzieren, wobei letztere ein intercompany Darlehen an Alaska Airlines finanzieren. Dieses Darlehen wird verwendet, um Schulden aus der Fusion mit Hawaiian Airlines zurückzuführen und für allgemeine Unternehmenszwecke. Die Finanzierung ist durch Sicherheiten, die mit dem Treueprogramm von Alaska verbunden sind, gesichert und wird von Alaska Airlines und anderen Tochtergesellschaften garantiert.
- Successful upsizing of the offering from $750 million to $1.25 billion, indicating strong investor demand
- Secured additional $750 million through Term Loan B, enhancing liquidity
- Proceeds to be used for debt repayment and improving liquidity position
- Financing secured by valuable loyalty program assets, potentially indicating favorable terms
- Increase in debt levels, which may impact the company's financial leverage
- Additional interest expenses from new debt issuance could affect profitability
Insights
Alaska Air Group's upsized offering of
The pricing of the notes at
This refinancing should help optimize Alaska's capital structure post-merger, potentially reducing interest expenses and extending debt maturities. The additional liquidity could provide a buffer against industry volatility and support future growth initiatives. However, investors should monitor how this increased debt load impacts the company's financial flexibility and leverage ratios going forward.
This financing package is a important step in Alaska Air Group's integration of Hawaiian Airlines following their December 2023 merger agreement. The strategic use of proceeds to redeem Hawaiian's existing debt, particularly the
The merger's success will largely depend on effective integration and realization of synergies. This refinancing provides a solid financial foundation for the combined entity, potentially accelerating the integration process and unlocking value for shareholders.
Investors should pay close attention to post-merger performance metrics, including cost synergies, revenue growth and market share in key routes. The ability to efficiently combine operations while maintaining customer satisfaction will be critical for long-term value creation in this consolidation play within the airline industry.
The Company expects to close the Loyalty Financings on or about October 15, 2024, subject to the satisfaction of customary conditions. Loyalty Issuer intends to use the net proceeds received from the Offering, together with borrowings under the Loyalty Term Loan Facility, in each case, after deducting fees and expenses payable by the Company, (i) to fund the reserve account for the Notes and the Loyalty Term Loan Facility and (ii) to fund a collection account, and the proceeds deposited into the collection account will be used to make an intercompany loan to Alaska Airlines, Inc ("
The Loyalty Financings will be (i) fully and unconditionally guaranteed on a senior secured basis, jointly and severally, by
This press release does not constitute an offer to sell or a solicitation of an offer to buy the Notes or any other securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to the registration and qualification under the securities laws of such state or jurisdiction. The Notes are being offered only to persons reasonably believed to be "qualified institutional buyers" in an offering exempt from registration in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside
Forward-looking statements in this press release and certain oral statements made from time to time by representatives of the Company contain various forward-looking statements within the meaning of Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act") which are subject to the "safe harbor" created by those sections. Forward-looking statements are based on our management's beliefs and assumptions and on information currently available to our management. All statements other than statements of historical facts are "forward-looking statements" for purposes of these provisions. In some cases, you can identify forward-looking statements by terms such as "may," "will," "should," "could," "would," "expect," "plan," "anticipate," "believe," "estimate," "project," "predict," "potential," and similar expressions intended to identify forward-looking statements. Forward-looking statements include, without limitation, statements regarding the Company's intentions and expectations regarding revenues as well as statements regarding the Offering described in this press release. Such forward-looking statements are subject to risks, uncertainties and other important factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by such forward-looking statements.
Factors include, among others, risks include competition, labor costs, relations and availability, general economic conditions including those associated with pandemic recovery, increases in operating costs including fuel, inability to meet cost reduction, ESG and other strategic goals, seasonal fluctuations in demand and financial results, supply chain risks, events that negatively impact aviation safety and security, and changes in laws and regulations that impact our business and other factors, as described in the Company's filings with the Securities and Exchange Commission, including the detailed factors discussed under the heading "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and the Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2024 and June 30, 2024.
All forward-looking statements speak only as of the date made, and we undertake no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of the Offering. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. Risks or uncertainties (i) that are not currently known to us, (ii) that we currently deem to be immaterial, or (iii) that could apply to any company, could also materially adversely affect our business, financial condition, or future results. Additional information concerning certain factors is contained in the Company's Securities and Exchange Commission filings, including but not limited to the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K.
Alaska Air Group, Inc. is based in
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SOURCE Alaska Air Group, Inc.
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