A senior group of JetBlue Airways creditors is working with restructuring adviser PJT Partners and law firm Akin Gump Strauss Hauer & Feld as the US airline faces cash burn, higher oil prices and sharply weaker debt and equity valuations. The group reportedly includes holders of about $2 billion of notes due in 2031 and a consortium linked to a $742 million first-lien loan.
JetBlue’s 2031 bonds fell to about 42 cents on the dollar on 22 October, from roughly 80 cents earlier in the month, while the airline’s shares also reached record lows. The debt is backed by collateral linked to JetBlue’s TrueBlue loyalty programme and associated credit-card revenue.
The advisers will allow creditors to assess potential negotiations over debt terms, collateral or other forms of financial support while protecting their position. Their appointment does not indicate that JetBlue has filed for bankruptcy or formally decided to restructure, and no operational changes have been confirmed.
JetBlue, PJT Partners and Akin Gump had not immediately responded to requests for comment. The creditor action comes ahead of JetBlue’s third-quarter results, as investors assess whether the airline’s turnaround can reduce cash consumption and withstand persistently high fuel costs.