US Treasury plans to auction airline warrants with a minimum price of $492 million

From Investing.com: 2024-05-28 17:51:09

The U.S. Treasury Department plans to auction warrants to purchase shares in U.S. airlines next week, seeking a minimum of $492 million. Airlines received $54 billion in COVID-19 bailouts, with American Airlines leading at $12.6 billion, followed by Delta, United, and Southwest receiving billions as well. Seven other airlines also received smaller awards.

The Treasury will auction warrants in 11 airlines, setting reserve prices ranging from $221 million for Delta to $1.7 million for Southwest. The government is seeking at least $50,000 per airline for warrants in Allegiant, Spirit Airlines, and JetBlue, priced below current trading prices. Warrants expire between April 2025 and June 2026.

In addition to bailouts, the U.S. government extended $25 billion in low-cost loans to airlines, aiming to provide returns to taxpayers from pandemic assistance. Air travel demand plummeted in 2020, with U.S. passenger traffic falling by 60% compared to 2019, marking the lowest level since 1984 as airlines struggled to cut costs and survive the crisis.



Read more at Investing.com: US Treasury sets $492 million minimum price for airline warrants auctions By Reuters