United explores MileagePlus minority-stake sale

United Airlines is exploring a potential sale of a minority stake in its frequent-flier program MileagePlus, according to people familiar with the matter. United is working with financial advisers who have begun contacting potential investors including private equity firms, the people said, asking not to be identified because the matter is private. Any minority stake in the MileagePlus subsidiary is expected to represent less than 15% of the portfolio, one of the people said. Discussions are early and United could ultimately decide not to proceed with a sale. A representative for United declined to comment. United is the first major US airline to explore selling off a chunk of its frequent-flier program, a move that most airlines have resisted despite investor pressure going back more than a decade to capitalize on their latent value. Instead, most carriers have leveraged them by using the richly valued programs as collateral to issue debt. United, which like many airlines has been hard hit by the pandemic, is pursuing the sale to highlight the loyalty of its mileage portfolio, some of the people said. One key reason for the sale is to enhance the program’s financial performance by using the new partner’s expertise to help better monetize data from the business, according to one person familiar with the company’s thinking. A sale would bolster the company’s balance sheet without the issuance of new debt or equity. The Chicago-based company valued MileagePlus -- which has more than 100m members -- at nearly $22b in 2020 when it tapped the program for one of the largest debt sales in the history of the aviation industry. The loyalty scheme backstopped $6.8b in bonds and loans that United sold to help it weather the pandemic.<br/>