Air Canada considers C$300 million notes issue along with term loan

By Cristal Cody

Tupelo, Miss., June 24 - Air Canada plans to market a potential C$300 million offering of notes (B2/B/) with meetings on Wednesday, according to an informed source on Monday.

"There's the U.S. dollar term loan B and possibly a C-dollar deal, but given the market, they may not do anything at all," the source said. "The market is really volatile right now. The market's in shambles right now."

Citigroup Global Markets Inc. is the lead manager.

The notes will share in the same collateral pool as Air Canada's previously announced $1 billion six-year senior secured term loan and $100 million revolver.

The Saint-Laurent, Quebec-based full-service airline plans to use the proceeds in combination with the term loan B to repay its 9 ¼% senior secured notes due 2015, 10 1/8% senior secured notes due 2015 and 12% senior second-lien notes due 2016 and for general corporate purposes.

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