Wheels Up finalises $40m term loan with Kore Capital
Wheels Up Experience announced that it has closed a new investment of $40m by Kore Capital.
“As discussed on our earnings call last week, we expect our cash balance at the end of the year will be flat to up versus third quarter levels, reflecting a stabilization of deferred revenue and working capital, the absence of the one-time transaction costs, and proceeds received from the additional term loan,” said George Mattson, CEO, Wheels Up.
These new investors join Delta Air Lines, Certares Management LLC, Knighthead Capital Management LLC and Cox Enterprises under the existing Credit Agreement. Earlier this year in September, Wheels Up announced a cash infusion of $450m by Delta, Cox Enterprises, and CK Wheels.
Upon the closing of this new investment, the credit facility now consists of the $390m term loan and the revolving credit facility of $100m.
In connection with closing the additional term loan, Wheels Up completed the second issuance of shares of common stock to the lenders on November 15, 2023, such that the lenders now hold shares equal to approximately 95% of the company’s outstanding equity on a fully diluted basis as of September 15, 2023, after giving effect to such issuance.
In its third quarter results announced last week, the charter and jet-card provider’s sales fell $100m whereas the number of members also witnessed a decline of 15% with live flight legs down 21%.
Wheels Up’s revenue declined by $101m in the 1Q 2023 and $161m in the second quarter as the company undergoes a restructuring to improve profitability.