United projects USD 17bn in available liquidity by September 2020

United Airlines (NASDAQ: UAL) has announced that, with a proposed USD 5bn MileagePlus transaction, it expects to have total available liquidity of approximately USD 17 billion at the end of the third quarter of 2020, the company said.

Committed financing of USD 5 billion is to be secured by the airline´s loyalty program, MileagePlus, that allows the airline to continue to operate, evolve, and grow the program, as well as USD 4.5 billion expected to be available to United through the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) Loan Program.

The company believes it has sufficient slots, gates and routes collateral available to meet the collateral coverage that may be required for the full USD 4.5 billion available to the company under the Loan Program. This USD 9.5 billion of additional liquidity will provide even more flexibility as the airline navigates the most disruptive financial crisis in the history of aviation.

Goldman Sachs Lending Partners LLC, Barclays Bank PLC and Morgan Stanley Senior Funding, Inc. have committed to provide, and have agreed to arrange the syndication of, the MileagePlus financing through a term loan facility, which is expected to close, subject to standard conditions precedent, by the end of July 2020. Goldman Sachs Lending Partners LLC will act as the sole structuring agent and lead left arranger for the transaction.

MileagePlus has more than 100 million members, over 100 program partners, and is an essential asset for United.