Southwest Airlines has issued a $1 billion bond, the proceeds of which will be used to fund the airline at a time when revenue is down significantly due to the corona virus downturn. The $300 million five-year notes carry a coupon of 5.25% while the $700 million seven-year notes pay 5.125%, a 29 July regulatory filing shows. Goldman Sachs and Wells Fargo are joint bookrunners. The Dallas-based carrier reported on 23 July a $915 million loss for the second quarter, noting that it is preparing for long-term volatility until a coronavirus vaccine or therapeutics are widely available. In early June, the carrier issued a $1.8 billion unsecured bond to refinance its March 364-day term loan and enhance liquidity for the business. $500 million three-year notes were issued at 4.75% and $1.3 billion seven-year notes at 5.125%. Southwest remains the only investment-grade airline in the USA..

Source: Cirium

The disinfection of aircraft has added at least 20min to turnaround times for Air Baltic's Airbus A220-300 fleet, according to the carrier's chief executive. Speaking during an FIA Connect session on 20 July, Martin Gauss explained that Air Baltic is "technically" flying 11 aircraft today, "but we use 16 for it". "One of the reasons is that we have a minimum turnaround time now of 60 minutes because of the disinfection," he says. The Latvian airline – which operates a hybrid model featuring ultra-low-cost economy seating and a small business-class area at the front of the cabin – confirms that its pre-coronavirus average turnaround time was 40min. As a result, "utilisation is nowhere [near] where it should be", says Gauss. "That is one of the prices you have to pay for that kind of an operation." Announcing new onboard health measures in mid-May as it moved to restart operations, Air Baltic said that "the aircraft cabin disinfection will be done with increased regularity", while passengers would be "provided with a complimentary basic care kit consisting of a protective face mask and disinfection wipes". Crew members are required to wear a protective face mask and gloves. During the same FIA Connect session, Gauss said that Air Baltic is bringing one of its Airbus A220s back into service every week as it ramps up operations. He also expressed optimism that his airline and the wider industry would recover, but said a cautious approach was required as services are reintroduced.

Source: Cirium

South African carrier Comair’s rescue practitioners have disclosed that a potential deal with an interested consortium has fallen through, but are pushing back publication of a business plan to provide time to consider other approaches.
Publication of the business plan had been due on 28 July after an expression of interest was received from a consortium on 21 June. But the interest has not translated into a binding offer because, the practitioners state, it ran into approval problems with a funding committee. “[The offer] therefore could not be taken forward,” they add. “[We] understand, to date, that this has not changed.” But the practitioners point out that two other consortia have each signed non-binding offers, both of which contain “several material conditions” which must be satisfied before being made binding. “At this time, the ability for [Comair] and the practitioners to fulfil the conditions in these offers, and the willingness of the company’s financiers to participate with the [consortia], remain unknown,” they add. Understanding whether the parties will be able to meet the necessary conditions – and whether either offer would be able to resolve the airline’s financial distress – will take time to evaluate. The practitioners are also negotiating urgent short-term bridge funding in order to support the progress of the offers, as well as meet the company’s expenses. Creditors are being asked to approve a delay to publication of the business plan until 28 August, by which point the airline will have spent almost four months in the rescue process.

Source: Cirium