American Airlines unveils $7.5 billion debt sale to repay government loans

American Airlines Group Inc said on Monday it will sell $7.5 billion of bonds and leveraged loans backed by its loyalty program to repay U.S. government debt.

While U.S. airlines received billions of dollars in federal grants to cover payroll costs over the past year, American also secured up to $7.5 billion of term loans from the U.S. Treasury to help it navigate the coronavirus pandemic.

Under the deal announced on Monday, American will issue a private offering of notes worth about $5 billion, half due in 2026 and half in 2029, and a $2.5 billion term loan credit facility.