American closes $120m subordinate EETC

Washington DC
This story is sourced from Pro
See more Pro news »

American Airlines closed its $119.8 million subordinate enhanced equipment trust certificates (EETC) private placement today.

The secured five-year notes priced with a coupon of 6.125% - on par with those of United's $425 million 2012-3 class C issue in December 2012 but 67.5bp higher than the coupon on US Airways $100 million 2012-2 C tranche in May.

The spread was 507.5bp over five-year US Treasury bonds, as of 4 June.

The 2013-1C issue is subordinate to American's $506.7 million A tranche and $156.6 million B tranche that closed in March. They are backed by 13 Boeing aircraft, including eight 737-800s, one 777-200ER and four 777-300ERs. Two of the 777-300ERs have yet to be delivered.

Fitch Ratings rates the notes CCC and Standard & Poor's rates them CCC+.

Citi, Deutsche Bank, Goldman Sachs, JP Morgan and Morgan Stanley underwrote the issue and Natixis was depositary. Wilimington Trust is trustee.