Fitch rates Air Canada certificates BBB-

Fitch Ratings said it assigned a rating of BBB- to Air Canada's proposed refinancing of its 2013-1 class B enhanced equipment trust certificates issuance.

The new certificates will refinance the 2013-1 class B certificates and will be secured by the same collateral of five 777-300ERs. The 2013-1 class B certificates are scheduled to mature on May 15. The company plans to issue $84.1 million in new class B certificates to refinance the debt balance of the same amount. The new certificates will amortize over four years and will mature with the class A certificates.

Fitch affirmed the BBB- rating on the existing certificates on May 5 and downgraded its ratings on the class A certificates to BBB from A-.

“The downgrade of the class A certificates was primarily driven by weakening collateral coverage caused by declining appraised values on 777-300ERs,” the agency said in a press release.

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