There are some old aircraft in there. One might recall that UA tried to collateralize this bunch of aircraft before (before they did the MileagePlus loan) and decided to pull the offering when it looked like rates might be 11.75% annually.https://www.fool.com/investing/2020/05/ ... ering.aspx
Do you want to lend money against a 26-year-old 757? Not me.
The Financial Times takes a similar view with an apt title. After this there wont be much left to mortgage as they are throwing in just about anything random they can as collateral.United throws ‘kitchen sink’ at investors to secure $3bn borrowinghttps://www.ft.com/content/b11a4b7f-b18 ... 922db6d731
In good news though they managed a 6% interest rate, far better than last time when creditors wanted 10%+ (Though as the article mentions investment-grade corporate bonds are closer to 2% yield today).
Also Goldman Sachs agreed to provide a liquidity line to cover 18-months of interest payments.
All told this makes $22bil United has raised in the last 7-months. One heck of a pile of debt to dig out of.
I think UA is now somewhere near $32B dollars in debt, like you stated that is a staggering number. But all 3 of the US3 are up to their eyeballs in debt I think DL is somewhere around $26B in debt and who knows how much AA is in.
I know what UA told employees during the earnings live event but we really need to get our daily cash burn rate down.
In other UA news on today October 21st UA is beta testing a global health app on flights between the UK and the U.S.
For now the test was conducted on UA's LHR-EWR flight, it was 100% voluntary, passengers were not required to participate.
Volunteers were given a COVID test by certified lab the test results were then uploaded to the app on their smartphone. Passengers also completed the required health screening questions on their smartphone. Once the test result and the questionnaire are done the app generates a QR code that is scanned by airline staff (before boarding) and border officials (upon arrival). The CDC is working with their counterpart in the UK the aim is to hopefully reopen the border between these two countries, and to perhaps expand this to other countries.
The app eventually could be use to upload vaccination recorded.https://www.reuters.com/article/us-heal ... SKBN2760HI
I may be going out on a limb here but I think in 2021 if people want to travel internationally they will need to show a negative COVID test or show they have been vaccinated (once available). I think this will be the new norm for all of 2021. Perhaps in 2022 countries may fully reopen meaning passengers will no longer need to show a negative test or vaccination records.