AMR secures $4.2 billion in new financing and increased liquidity

[FWAAA]

Looks like $830 million of new cash and $3.4 billion of financing (and debt refinancing) for the new 738s on the way:

AMR Corporation Completes Offerings of Common Stock and Convertible Notes; Announces Approximately $4.2 Billion in Additional Liquidity and Financing in September

Expects to End Third Quarter with Approximately $4.4 Billion in Cash; Additional Proceeds from $450 Million Private Debt Sale Expected to be Received in October

PRNewswire
FORT WORTH, Texas

FORT WORTH, Texas, Sept. 29 /PRNewswire-FirstCall/ -- AMR Corporation (NYSE: AMR), the parent company of American Airlines and American Eagle Airlines, announced the completion of its offerings of 48,484,849 shares of its common stock and $460,000,000 principal amount of its 6.25% convertible senior notes due 2014. Completion of the offerings, which closed yesterday, together with a number of other recent transactions, has improved the company's liquidity position as it seeks to weather the current global financial downturn and build a financial foundation for the future. The aggregate net proceeds from the offerings, after underwriting discounts and expenses, were approximately $830 million.

All told, AMR and American have announced approximately $4.2 billion in additional liquidity and new aircraft financing in September. All of this financing is in addition to the more than $1.2 billion the Company raised earlier this year through both private and public financings of owned aircraft and the financing of new 737s to be delivered through 2011.

http://aa.mediaroom.com/index.php?s=43&item=2741

Back up to about $4 billion of unrestricted cash. Not as much as a couple years ago, but should be enough.

 

[The Goose]

Looks like $830 million of new cash and $3.4 billion of financing (and debt refinancing) for the new 738s on the way:



http://aa.mediaroom.com/index.php?s=43&item=2741

Back up to about $4 billion of unrestricted cash. Not as much as a couple years ago, but should be enough.

The company seems to be doing what they can to keep the stock price around $8/share by dilution.

As far as the 737s are concerned, They're probably hoping to take advantage of other airlines' deferrals and speed up the a/c restocking program, perhaps having delusions about doing the same with the 787.

 

[FrequentFlierCA]

Don't forget that a big part of the reason AA was able to raise all of these funds is that its credit rating is significantly better than its fellow legacy airlines, all of which have been through bankruptcy at some point, and all but one (CO) since 9/11. United tried to raise money a few months ago by mortgaging spare parts and ended up paying an interest rate of more than 15%.

Having kept AMR out of the courts is having some clear benefits today.