United Air Lines to boost liquidity by $275 million
3 September 2009
UAL Corporation, the holding company whose primary subsidiary is United Airlines, today announced financing transactions that will add approximately $275 million of cash prior to year end. The company has completed a $125 million aircraft financing agreement, receiving approximately $60 million yesterday, and will receive the remaining approximately $65 million by mid October.
United has also executed agreements and agreements in principle (subject to reaching final documentation and other conditions) to sell certain assets for approximately $140 million. The company received approximately $30 million from these assets in the third quarter and expects to receive approximately $110 million in the fourth quarter. In addition, United intends to substitute certain cash collateral with a letter of credit, generating $10 million in net incremental cash in the fourth quarter.
"We are further strengthening our cash position, and we are pleased to close this transaction, particularly in this market environment," said Kathryn Mikells, who will become chief financial officer on November 1. "We still have over $3 billion of unencumbered assets to further enhance our liquidity."