America West greenshoe partially exercised, raising convertibles to $86.8 million

New York, Aug. 21 - America West Airlines said underwriters of its offering of senior exchangeable notes due 2008 exercised $11.8 million proceeds of the over-allotment option, raising the size of the deal to $86.8 million proceeds.

The Phoenix airline, a subsidiary of America West Holdings Corp., originally sold $75 million proceeds of the cash-to-zero securities after the market closed on July 24 to yield 7.25% with a 30% initial conversion premium. The greenshoe was for up to $15 million.

Citigroup and Merrill Lynch & Co. were bookrunners for the Rule 144A offering.

America West put $42.9 million of the proceeds in a special account to collateralize principal and interest payments on some of its debt up to Sept. 30, 2004. The balance will be used for working capital and general corporate purposes.

"We are pleased to have been able to increase our liquidity through this note offering," said Derek J. Kerr, chief financial officer, in a news release. "This successful transaction is evidence of the capital markets' appreciation of America West's turnaround and confidence in our future."

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