The Qantas Group secured a $1.05 billion loan on Wednesday morning, which caused shares to soar by 25 per cent.
This debt has been secured against part of its fleet of unencumbered aircraft, which were bought with cash in recent years. The loan has a tenure of up to 10 years at an interest rate of 2.75 per cent.
This funding increases Qantas’ available cash balance to $2.95 billion with an additional $1 billion undrawn facility remaining available.
Qantas Group chief executive Alan Joyce said, “Over the past few years we’ve significantly strengthened our balance sheet and we’re now able to draw on that strength under what are exceptional circumstances.
“Everything we’re doing at the moment is focused on guaranteeing the long-term future of the national carrier, including making sure our people have jobs to return to when we have work for them again.”
Qantas shares peaked at $3.39 at one point on Wednesday and were the second top-gaining business on the ASX.
Last week, after the announcement it was to stand down two-thirds of its staff, Qantas was trading at just $2.03.