Indonesian flag carrier Garuda Indonesia won approval from investors to extend the maturity of a $500m sukuk, easing a cash squeeze as the airline battles falling passenger demand during the coronavirus pandemic. The state-owned airline, whose passenger traffic fell 91% in April from a year earlier, said Wednesday that investors holding 90.88% of the aggregate principal amount outstanding on its $500m sukuk voted in favour of a three-year extension. Garuda is also seeking to raise a bridge loan of as much as $500m to meet working-capital requirements for three to six months. The government, which owns 61% of the carrier, has unveiled a plan to provide 8.5t rupiah ($610m) for the company, which has grounded 70% of its fleet. “We are optimistic that this could be a significant initial step in the efforts to restore the performance of Garuda Indonesia which has been affected by the COVID-19 pandemic,” President Director Irfan Setiaputra said. While the maturity extension could provide the carrier with some cash flow relief, the company still needs a significant amount of funding to tackle the challenges presented by the pandemic, according to John Teja, a director at Ciptadana Sekuritas Asia.<br/>
sky
Delta returned to the bond market within weeks of its last visit, looking to support its liquidity and repay outstanding debt. The carrier sold $1.25b of five-year unsecured bonds that will yield 7.375%, according to a person with knowledge of the matter. The notes, which were originally marketed with a yield around 8%, carry high-yield ratings, but the offering was run by investment-grade debt syndicates, the person said. Delta borrowed $3.5b in April through a sale of five-year secured bonds, pledged by domestic slots at New York airports and those at Heathrow in London, but Wednesday’s offering comes with no collateral protection. It’s a sign of how much the market has rallied since then for Delta to merely announce an unsecured offering, especially when the stakes for strong collateral have never been so high. Delta has raised more than $10b since early March, including proceeds from a bond sale in April and two term loans, according to a filing Wednesday morning. <br/>