Delta Air Lines Seeks $3 Billion in Bonds, Loan Amid Travel Halt

Delta Air Lines Inc. is seeking to raise $3 billion from loans and bonds as it grapples with a global travel shutdown caused by the coronavirus pandemic.

The company is offering a $1.5 billion first lien term loan due 2023 and the same amount in senior secured bonds maturing in 2025, it said in a statement Wednesday. The debt, which will help boost liquidity, will be secured by collateral including domestic slots at New York airports and those at Heathrow in London as well as other European and Latin American routes, it said.

Barclays Plc will hold a lender call for the loan on Thursday, according to people familiar with the matter. Commitments are due April 28, the people said. JPMorgan Chase & Co. will lead the private bond offering.

Delta’s borrowing plans come after United Airlines Holdings Inc. sold more than $1 billion in stock at $26.50 a share—a historically low price and the first such offering by a major U.S. airline during the pandemic. Delta, which is already stepping up cost cutting efforts, obtained a $2.6 billion one-year loan from JPMorgan last month and has drawn $3 billion under its existing credit lines.

Delta Chief Financial Officer Paul Jacobson said on a call to discuss financial results on Wednesday that options for the airline included borrowing against $13.5 billion in unencumbered assets, or selling planes and leasing them back from the buyers. Delta has also applied for $4.6 billion in U.S. government loans which if tapped, would complement the $5.4 billion in emergency U.S. payroll support the company has already lined up.