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  • Joe Breitfeller

Spirit Airlines Announces Proposed Senior Secured Notes Backed by Brand and Loyalty Subsidiaries

Spirit Airlines announced on Monday that they hope to raise $600 million in aggregate principal from senior secured notes due 2025, backed by the carrier’s newly formed brand and loyalty subsidiaries.

Spirit Airlines Airbus A319 - Courtesy Spirit Airlines

On Monday, Spirit Airlines announced that they have formed two new subsidiaries in the Cayman Islands, namely Spirit IP Cayman Ltd., and Spirit Loyalty Cayman Ltd., which will be indirect wholly-owned subsidiaries of the company. The carrier intends to commence a private offering of $600 million in senior secured noted due 2025, backed by the new brand and loyalty subsidiaries. The notes will be secured by a first priority lien on the core assets of Spirit’s loyalty programs comprised of cash proceeds from the Free Spirit co-branded credit card programs and its $9 Fare Club program membership fees, as well the intellectual property associated with the aforementioned programs and Spirit’s brand IP.

Miramar, Florida-based low-cost carrier Spirit Airlines typically operates over 650 daily flights to 77 destinations in the US, Latin America and the Caribbean. The airline allows customers to select and pay for only the products and services they want, something they call “À La Smarte.” Spirit also operates one of the youngest and most fuel-efficient fleets in the US and recently firmed up an order for 100 new Airbus A320neo Family aircraft. The carrier proudly calls their youthful fleet of aircraft their “Fit Fleet®.”

Source: Spirit Airlines

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