US Airways plans $1.1b term loan refinancing

Phoenix
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US Airways plans to refinance its $1.1 billion term due next year by August, says chief financial officer Derek Kerr.

The Tempe, Arizona-based carrier plans to close the refinancing by August in order to avoid repayment provisions in the existing loan that could be triggered once its proposed merger with American Airlines closes, he says at a media event in Tempe.

Citi provided the existing loan that matures in March 2014.

Kerr says that he anticipates terms comparable to those achieved by Delta Air Lines and United Airlines in unsecured refinancings that they closed recently.

United closed a $900 million refinancing of an outstanding $1.19 billion term loan in March. The new debt has a six-year tenor and priced at 300bp over Libor.

Kerr says that US Airways can achieve terms "somewhere in that range" with slightly higher pricing, when asked about the United deal.

"The market's there and we want to do it," he says, adding that it would want to do the refinancing even without the proposed merger.