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Published on Friday, September 18, 2020

Delta secures USD9 billion in financing on SkyMiles program






Delta Air Lines says it is raising $9 billion in extra funding by mortgaging its SkyMiles loyalty program.


That is about $2.5 billion more than it initially expected.


It will raise it through new bonds and loans backed by its SkyMiles program.


The airline said it would not take a $4.6 billion federal loan available under the CARES Act, but is still pushing for another round of federal payroll protection grants.


Current payroll protection funding runs out at the end of September.


Several airlines have turned to their lucrative frequent flyer programs as a way to raise much-needed funds as the industry grapples with an unprecedented impact on travel demand.


United Airlines is using its MileagePlus program for new debt, and American Airlines plans to leverage its AAdvantage program as collateral for a government loan.


Delta says it is still burning through about $27 million in costs a day.


 


Written by Ray Montgomery, US editor

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