Sky Money
Virgin Australia Aims for $2 Billion IPO Valuation
- American priced a $750 million senior secure private term loan with a 7.25 percent interest rate last week. That’s steep, but not surprising, given proceeds partially repay debt — the $1.75 billion outstanding under American’s 2013 secured term loan facility due in 2025 — that carried an average variable rate of 4.83 percent in the third quarter. High interest rates have pushed up the cost of borrowing for many companies. The maturity of the balance of the 2013 facility, roughly $1 billion, will be extended to 2028. A pool of selected gate, slot, and route assets from American’s U.S. operations, as well as to Australia and New Zealand, secure the new debt.
- Bain Capital is moving forward with plans for an initial public offering for Virgin Australia. The private equity firm aims for a valuation of roughly A$3 billion ($2.1 billion) upon listing, the Australian Financial Review has reported. Goldman Sachs and UBS are in the running to manage the IPO. Bain took Virgin Australia private when it acquired the airline out of administration in 2020. The airline made a roughly A$125 million profit during the six months ending in December.
- Allegiant Air has agreed to a new up to $100 million senior secured revolving credit facility with a three-year term. The credit line carries a variable interest rate priced over the secured overnight financing rate, or SOFR. Proceeds of the new revolver, which is secured by a collateral pool of aircraft and engines, will be used for general corporate purposes. It replaces a $50 million revolver that expires in March.