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Fitch ups American Airlines loans, US Airways notes & convertibles
Fitch Ratings said it upgraded the ratings for American Airlines Group Inc. and its primary operating subsidiary, American Airlines, Inc., to B+ upon the company's expected emergence from bankruptcy and merger with US Airways.
The agency affirmed the existing ratings for US Airways Group, Inc. and US Airways Inc. at B+ following the completion of the merger with American Airlines, equalizing the ratings for all entities in the merged company.
The outlook is stable.
Fitch also upgraded the ratings on American's senior secured credit facility and revolver to BB+/RR1 from BB-/RR1, US Airways' senior unsecured notes to B+/RR4 from B-/RR6 and US Airways' unsecured convertible notes to B-/RR6 from CCC/RR6.
Fitch will be reviewing the existing ratings for various enhanced equipment trust certificates issued by US Airways and American. Those ratings will be updated within the next several business days.
The ratings are supported by the significant structural improvements achieved at American through the bankruptcy process which have resulted in improving operating results, the strong recent operating performance of US Airways, and expectations that credit metrics will improve quickly from current levels, the agency said.
The merger between US and American is also expected to produce a single carrier with a broad route structure that is expected to produce material revenue synergies and is much better suited to compete with its large domestic rivals, United and Delta. The projected liquidity position also supports the ratings.
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