By Cristal Cody
Tupelo, Miss., Feb. 26 – Air Canada priced $301,419,000 of enhanced equipment trust certificates in two tranches in a Regulation S private offering on Monday, according to a press release.
The company sold C$237,740,000 of 3.67% series 2018-1 class A certificates and C$63,679,000 of 4.19% series 2018-1 class B certificates.
The two tranches have a combined weighted average interest rate of 3.76%.
A definitive certificate purchase agreement is expected to be entered into with the purchasers of the certificates during the week of March 5, according to the release.
The funding dates for both tranches are scheduled for April 30, in the amount of about $87 million, and May 31, in the amount of about $214 million.
Each class of certificates will represent an interest in a related pass through trust. The trusts will use the proceeds from the offering to acquire equipment notes to be issued by Air Canada and secured by one new Boeing 787-9 aircraft and four new Boeing 737 MAX-8 aircraft, which are scheduled for delivery in April and May. The proceeds from the sale of the equipment notes will be used to finance the new aircraft.
The Canadian dollar-denominated offering has terms and conditions comparable to Air Canada’s U.S. dollar-denominated enhanced equipment trust certificates priced in 2017, Michael Rousseau, chief financial officer, said in the release.
In the Dec. 7, 2017 sale, Air Canada priced $719,181,000 of enhanced equipment trust certificates in three tranches.
Montreal-based Air Canada is Canada’s largest domestic and international airline.
| Issuer: | Air Canada
|
| Amount: | C$301,419,000
|
| Description: | Enhanced equipment trust certificates
|
| Trade date: | Feb. 26
|
| Distribution: | Regulation S private
|
|
|
| 2018-1 Class A certificates
|
| Amount: | C$237,740,000
|
| Coupon: | 3.3%
|
|
|
| 2018-1 Class B certificates
|
| Amount: | C$63,679,000
|
| Coupon: | 4.19%
|
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