American Airlines Group Inc (AAL.O) said on Tuesday it expects to raise about $2 billion through a stock-and-notes offering in an effort to bolster its balance sheet to better deal with a slowdown in travel due to the COVID-19 crisis.
The company plans to offer 74.1 million shares of its common stock priced at $13.50 per share, representing a 15.6% discount to Friday’s close, the last trading day before the company announced its plan to secure $3.5 billion in new financing.
American also said it would offer $1 billion in convertible senior notes with 6.5% coupon rate due 2025 in public offerings.
Shares were down nearly 7% at $13.93 in early trade.
The deal size increased from $1.5 billion in equity and convertible bonds as announced on Sunday. The carrier still plans to offer $1.5 billion in senior secured notes and intends to enter into a new $500 million term loan facility due 2024.
Goldman Sachs & Co LLC, Citigroup, BofA Securities and J.P. Morgan will be acting as representatives for the underwriters.