LATAM Airlines Group plans to issue a UF8.7 million (roughly $350 million) unsecured private placement in Chile, with proceeds used to repay its TAM Capital 3 debt.
The notes, which is denominated in Chile's Unidad de Fomento (UF) monetary units, is split into four tranches: UF2.5 million series A due in June 2022, UF2.5 million series B due in January 2028, UF1.85 million series C due in June 2022 and UF1.85 million series D due in January 2028, a securities filing on 28 July shows.
The A tranche carry an interest rate of 5.25%, the Bs 5.75%, the Cs 5.25% and the Ds 5.75%, according to the filing.
The bonds will be placed on the Chilean stock exchange, LATAM says.
Proceeds from the transaction will be used to partially fund the redemption of the $500 million outstanding under LATAM's TAM Capital 3 debt due in 2021. The outstanding notes carry an interest rate of 8.75%.
LATAM plans to fund the balance of the redemption from other financing activity and cash, a spokeswoman says.
The transaction follows the issue of a $700 million senior unsecured bond that priced at 6.875% in April, with proceeds partially going towards repaying $300 million outstanding under its TAM Capital notes due in 2017.
Updated with LATAM comments