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Mesa Shares Rise On Agreements With United Airlines

By RTTNews Staff Writer   ✉   | Published:   | Follow Us On Google News
rttnewslogo20mar2024

Mesa Air Group, Inc. (MESA) shares surged 44% on Friday after signing an agreement with United Airlines to amend its capacity purchase agreement and credit agreements.

MESA is trading on the Nasdaq at $0.92, up 44.60% or $0.28 per share. It has traded between $0.40 and $3.82 in the past 52-week period.

The amendment is expected to increase operating income and liquidity by $63.5 million over the next year, as the block-hour rate under its CPA will be increased.

The company also stated that United has agreed to reduce the outstanding balance on the credit facility by $2.1 million and relieve the $10.5 million principal amount of the bridge loan issued to Mesa. This is in exchange for Mesa's investment in Heart Aerospace, which results in the release of Mesa's equity investment in Archer Aviation.

Furthermore, the company said that it has sold excess CRJ-900 aircraft and related engines for $198 million since September 2023. The proceeds will be used to pay down $174.3 million in debt.

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