Air Canada announced today that it has completed two separate banking transactions in December 2018 which together have increased Air Canada's revolving lines of credit by approximately $600 million and overall liquidity by approximately $345 million.
In the first transaction, led by JPMorgan Chase Bank, National Association, the existing secured revolving credit facility was increased from US$300 million to US$600 million with the existing group of banks and the maturity date extended from 2021 to 2023. As part of this transaction, the US$800 million secured term loan (US$792 million outstanding) was reduced to US$600 million following a US$192 million cash repayment.
In the second transaction, led by The Toronto-Dominion Bank and involving other financial institutions including major Canadian banks, a new syndicated $200 million revolving credit facility was completed. The facility is available for three years and, if drawn, would be secured by certain designated aircraft.
"These transactions were concluded to further our de-leveraging strategy and to move away from holding excess amounts of cash and favoring lines of credit as we progress our efforts towards achieving an investment grade credit rating," said Pierre Houle, Managing Director and Treasurer of Air Canada.
There are no current plans to draw on these revolving lines of credit. As of Sept. 30, 2018, Air Canada had record unrestricted liquidity of $5.309 billion ($4.181 billion at Dec. 31, 2017).