Air Canada increases size of financing deal
Airline plans to issue 30.8 million shares to raise $500.5 million
MONTREAL—AIR Canada has increased the size of a financing deal announced this week to roughly $1.4 billion as it works to bolster its coffers to deal with the pandemic.
The company says the shares in the offering have been priced at $16.25 apiece. It plans to issue 30.8 million shares to raise about $500.5 million.
The airline will also issue $650 million (U.S.) in convertible senior unsecured notes due in 2025, up from an initial plan for $400 million.
The convertible notes will have an annual interest rate of four per cent and be convertible into Air Canada shares at a price of approximately $15.35 per share.
The underwriters of the share offering have an option to purchase up to an additional 15 per cent of the shares, while initial buyers of the convertible notes will also have an option to purchase up to an additional 15 per cent.
Air Canada says it will use the cash to supplement its working capital and other general corporate purposes.
The airline said on May 4 it had $6.5 billion (Canadian) in unrestricted liquidity after drawing about $1 billion in March from its revolving credit facilities.
The carrier lost more than $1 billion last quarter and grounded the vast majority of its fleet as travel demand hovers near ground level while fixed costs persist, including aircraft leases, insurance and maintenance and hangar fees.
SAINT JOHN, N.b.—irving Oil has signed a deal to buy North Atlantic Refining Corp., including a refinery in Come By Chance, N.L., from U.S. investment firm Silverpeak.
Financial terms of the agreement, which includes a network of gas stations and other marketing assets, were not disclosed.
North Atlantic provides fuel products to businesses and consumers across Newfoundland.
The refinery has capacity of 130,000 barrels per day.
Production at the refinery was stopped on March 30 due to the pandemic.
The sale is subject to regulatory review and other conditions.