U.S.$667,370,000 of 3.600% Air Canada Pass Through Certificates, Series 2015-1, Class A
U.S.$182,010,000 of 3.875% Air Canada Pass Through Certificates, Series 2015-1, Class B
U.S.$182,010,000 of 5.000% Air Canada Pass Through Certificates, Series 2015-1, Class C
MONTREAL, March 11, 2015 /CNW Telbec/ - Air Canada announced today the pricing of its previously announced private offering of three tranches of enhanced equipment trust certificates (the "Certificates"). The three tranches of certificates have a combined aggregate face amount of U.S.$1,031,390,000 and a weighted average interest rate of 3.810%.
The private offering is comprised of Class A Certificates, Class B Certificates and Class C Certificates. The Class A Certificates will have an interest rate of 3.600% per annum and a final expected distribution date of March 15, 2027. The Class B Certificates will have an interest rate of 3.875% per annum and a final expected distribution date of March 15, 2023. The Class C Certificates will have an interest rate of 5.000% per annum and a final expected distribution date of March 15, 2020.
Each class of Certificates will represent an interest in a related pass through trust. The trusts will use the proceeds from the offering to acquire equipment notes to be issued by Air Canada and secured by one Boeing 787-8 aircraft delivered in January 2015 and eight new Boeing 787-9 aircraft, which are currently scheduled for delivery from July 2015 to March 2016. The security interest in each of the aircraft will benefit from the protections of the Cape Town Convention on International Interests in Mobile Equipment and the Protocol thereto on Matters Specific to Aircraft Equipment, as enacted in Canada.
Air Canada will use the proceeds from the sale of equipment notes related to the Boeing 787-8 aircraft currently owned by Air Canada for general corporate purposes and to pay fees and expenses related to the offering, and will use the proceeds from the sale of the other equipment notes to finance the acquisition of the eight new Boeing 787-9 aircraft.
The offering is expected to close on March 25, 2015, subject to customary closing conditions.
The Certificates will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or the securities laws of any other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and state securities laws. The Certificates will be offered and sold only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act, and to persons other than U.S. persons in transactions outside the United States in reliance on Regulation S under the Securities Act.
The Certificates will not be qualified for sale to the public under applicable Canadian securities laws and, accordingly, any offer and sale of the Certificates in Canada will be made on a basis that is exempt from the prospectus requirement of such securities laws.
This press release shall not constitute an offer to sell the Certificates or the solicitation of an offer to buy the Certificates, nor will there be any sale of the Certificates, in any state or jurisdiction where such offer, solicitation or sale is not permitted. The Certificates will be offered only through a preliminary and final offering memorandum and this press release is not intended to serve as the basis for any investment decision.
About Air Canada
Air Canada is Canada's largest domestic and international airline serving more than 190 destinations on five continents. Canada's flag carrier is among the 20 largest airlines in the world and in 2014 served more than 38 million customers. Air Canada provides scheduled passenger service directly to 64 Canadian cities, 52 destinations in the United States and 78 cities in Europe, the Middle East, Asia, Australia, the Caribbean, Mexico, Central America and South America. Air Canada is a founding member of Star Alliance, the world's most comprehensive air transportation network serving 1,321 airports in 193 countries. Air Canada is the only international network carrier in North America to receive a Four-Star ranking according to independent U.K. research firm Skytrax that ranked Air Canada in a worldwide survey of more than 18 million airline passengers as Best Airline in North America in 2014 for the fifth consecutive year.
Caution Regarding Forward-Looking Information
Air Canada's public communications may include forward-looking statements within the meaning of applicable securities laws. Forward-looking statements, by their nature, are based on assumptions and are subject to important risks and uncertainties. Forward-looking statements cannot be relied upon due to, amongst other things, changing external events and general uncertainties of the business. Actual results may differ materially from results indicated in forward-looking statements due to a number of factors, including without limitation, industry, market, credit and economic conditions, the ability to reduce operating costs and secure financing, energy prices, currency exchange and interest rates, competition, employee and labour relations, pension issues, war, terrorist acts, epidemic diseases, environmental factors (including weather systems and other natural phenomena and factors arising from man-made sources), insurance issues and costs, changes in demand due to the seasonal nature of the business, supply issues, changes in laws, regulatory developments or proceedings, pending and future litigation and actions by third parties as well as the factors identified throughout Air Canada's public disclosure file available at www.sedar.com. In addition, the closing of the offering of Certificates is subject to general market and other conditions and there are no assurances that the proposed offering will be completed or that the terms of the offering will not be modified. Any forward-looking statements contained in this news release represent Air Canada's expectations as of the date of this news release and are subject to change after such date. However, Air Canada disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.
SOURCE Air Canada - Corporate - Finance