Spirit Airlines Announces Closing of 1.00% Convertible Senior Notes Due 2026 and other transactions
On May 3, 2021, Spirit Airlines (NYSE: SAVE) completed several liability management transactions, raising $371.3 million through the issuance of shares to holders of its 4.75% Convertible Senior Notes due 2025. The majority of these proceeds were utilized to redeem $340 million of its 8.00% Senior Secured Notes due 2025. Additionally, Spirit issued $500 million in 1.00% Convertible Senior Notes due 2026. These transactions are expected to reduce debt by $31.8 million and provide annual interest savings of $30.1 million.
- Raised $371.3 million by issuing shares, enhancing liquidity.
- Redeemed $340 million of higher interest debt, lowering future interest expenses.
- Issuance of 1.00% Convertible Senior Notes reduces overall debt exposure.
- Still has $510 million of 8.00% Senior Secured Notes outstanding.
MIRAMAR, Fla., May 3, 2021 /PRNewswire/ -- Spirit Airlines, Inc. (NYSE: SAVE) ("Spirit") entered into a series of liability management transactions given the favorable market dynamics.
The Company received
In addition, the Company issued
The net effect of the transactions mentioned above is expected to result in the following:
Debt Reduction | Est. Annualized Interest | Run-rate Net Shares | Liquidity |
(0.9) Million |
Giving effect to these transactions, weighted average basic shares outstanding for the second quarter 2021 are estimated to be 105.3 million.
In periods that the Company is profitable and that its average share price for that period is less than
(1) | Interest savings related to repaying the Senior Secured Revolving Credit Facility due March 2024 was calculated using 1-month LIBOR as of 4/30/2021 plus |
(2) | If the Company is profitable for any period, the dilutive impact of the 2025 Convertible Notes will be approximately 2.2 million shares. If the Company is profitable and the average stock price for the period is greater than |
Forward-Looking Statements
Statements in this release contain various forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (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 related to the proposed terms of the offerings described herein, the completion, timing, and size of the proposed offerings, and the anticipated use of proceeds from the offerings. 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, the extent of the impact of the COVID-19 pandemic on Spirit's business, results of operations and financial condition, and the extent of the impact of the COVID-19 pandemic on overall demand for air travel, restrictions on Spirit's business by accepting financing under the CARES Act, the competitive environment in our industry, our ability to keep costs low and the impact of worldwide economic conditions, including the impact of economic cycles or downturns on customer travel behavior, and other factors, as described in Spirit's filings with the Securities and Exchange Commission, including the detailed factors discussed under the heading "Risk Factors" in Spirit's amended Annual Report on Form 10-K/A for the fiscal year ended December 31, 2020, as supplemented in the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2021. Furthermore, such forward-looking statements speak only as of the date of this release. 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.
About Spirit Airlines:
Spirit Airlines (NYSE: SAVE) is committed to delivering the best value in the sky. We are the leader in providing customizable travel options starting with an unbundled fare. This allows our Guests to pay only for the options they choose — like bags, seat assignments and refreshments — something we call Á La Smarte. We make it possible for our Guests to venture further and discover more than ever before. Our Fit Fleet® is one of the youngest and most fuel-efficient in the U.S. We serve destinations throughout the U.S., Latin America and the Caribbean, and are dedicated to giving back and improving those communities. Come save with us at spirit.com. At Spirit Airlines, we go. We go for you.
View original content to download multimedia:http://www.prnewswire.com/news-releases/spirit-airlines-announces-closing-of-1-00-convertible-senior-notes-due-2026-and-other-transactions-301282150.html
SOURCE Spirit Airlines, Inc.
FAQ
What is Spirit Airlines' recent financial transaction?
How much debt did Spirit Airlines reduce?
What is the impact of Spirit Airlines' new convertible notes issuance?
How will the recent transactions affect Spirit Airlines' interest expenses?
