British Airways completes two new funding measures
International Airlines Group (IAG) has completed two financing agreements for British Airways.
In total, the deals will leave the flag-carrier with liquidity of £2.45 billion.
In addition to these arrangements, the group said it continues to explore other debt initiatives to further improve its financial situation.
First, on December 31st, IAG announced that British Airways had received commitments for a five-year export development guarantee term-loan of £2 billion underwritten by a syndicate of banks, partially guaranteed by UK Export Finance (UKEF).
The carrier has now reached final agreement with UKEF and the lenders and expects to drawdown the facility before the end of this month.
British Airways has also reached agreement with the Trustee of New Airways Pension Scheme (NAPS) to defer £450 million of pension deficit contributions due between October last year and September 2021.
The agreement includes the deferral of monthly contributions of £37 million for the period, while NAPS Trustee agreed to temporary deferrals of the contributions due in October, November, December and January.
Repayment of the cash plus interest will be added to the end of the existing recovery plan as monthly payments from March 2023.
No dividends will be paid by British Airways to IAG before the end of 2023.
NAPS opened in 1984 and was closed to new joiners in 2003 and to future accrual in 2018.