AA Secures $5.5B Treasury Loan
09-25-2020 | 04:53 PM
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AA Secures $5.5B Treasury Loan
https://finance.yahoo.com/news/ameri...210926494.html
This was from the original CARES Act. AA had until September 30th to decide whether to take the loan. They could get another $2B.
This was from the original CARES Act. AA had until September 30th to decide whether to take the loan. They could get another $2B.
09-25-2020 | 06:28 PM
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AA pre Covid had $30B in debt, by far the most leveraged airline. After Covid, debt has gone up $10B+, and they have mortgaged pretty much every valuable asset. There is only one way this ends for AA, unless creditors negotiate outside of BK. A ver large chunk of debt is airplane debt, as we all know, they went on a huge spending spree the last 10-15 years. The only thing that might save AA from BK is aircraft financiers/lessors restructuring aircraft debt. Otherwise, how do you repay $40B back?
09-25-2020 | 10:12 PM
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AA pre Covid had $30B in debt, by far the most leveraged airline. After Covid, debt has gone up $10B+, and they have mortgaged pretty much every valuable asset. There is only one way this ends for AA, unless creditors negotiate outside of BK. A ver large chunk of debt is airplane debt, as we all know, they went on a huge spending spree the last 10-15 years. The only thing that might save AA from BK is aircraft financiers/lessors restructuring aircraft debt. Otherwise, how do you repay $40B back?
09-26-2020 | 08:23 AM
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I'm no expert. But, I have a feeling aircraft are going to be cheaper to come by in the future. Comparatively, they might get better deals than AA ever did.
09-26-2020 | 09:19 AM
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And it’s actually a double-whammy. Not only are there cheap deals out there on new-ish used aircraft, but the collateral value of new-ish aircraft that you already own has taken a big hit too.
Sometimes timing is everything. Neeleman and his Breeze startup might have found it hard to even find pilots willing to work for the wages he isexpecting to pay only a year ago. Now they are flooding him with apps.
09-26-2020 | 02:14 PM
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AA pre Covid had $30B in debt, by far the most leveraged airline. After Covid, debt has gone up $10B+, and they have mortgaged pretty much every valuable asset. There is only one way this ends for AA, unless creditors negotiate outside of BK. A ver large chunk of debt is airplane debt, as we all know, they went on a huge spending spree the last 10-15 years. The only thing that might save AA from BK is aircraft financiers/lessors restructuring aircraft debt. Otherwise, how do you repay $40B back?
Our stock was a laggard industry wide for years while the debt binge was happening. The BOD’s had no qualms about the goings on.
09-27-2020 | 09:04 PM
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