2014

Air Canada Successfully Completes US$400 Million Unsecured Financing

MONTREAL, April 15, 2014 /PRNewswire/ - Air Canada announced today that it has completed its previously announced private offering of US$400 million of 7.75% senior unsecured notes due 2021 (the "Notes"). Air Canada received net proceeds of approximately C$432 million from the sale of the Notes and will use these proceeds for general corporate purposes.

"The successful completion of our unsecured note offering is another significant transformational event for Air Canada as we enter a new phase of capital investment in our fleet and product," said Calin Rovinescu, President and Chief Executive Officer. "I was especially pleased with the offering's reception. The capital markets have demonstrated their confidence in Air Canada by extending us credit on an unsecured basis on competitive terms, recognizing, among other things, Air Canada's improved leverage ratios, credit ratings and profitability, as well as the elimination of the pension deficit overhang. I would also like to recognize the work of our legal and finance teams in concluding this offering in a timely manner and on favourable terms."

The Notes were sold at par and provide for interest payable semi-annually. The Notes are senior unsecured obligations of Air Canada, and are guaranteed on a senior unsecured basis by one of Air Canada's subsidiaries.

The Notes were offered and sold in the United States only to qualified institutional buyers in reliance on Rule 144A under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and to certain non-U.S. persons in transactions outside the United States in reliance on Regulation S under the Securities Act. The Notes have not been and will not be qualified for sale to the public under applicable Canadian securities laws and, accordingly, any offer and sale of the Notes in Canada will be made on a basis that is exempt from the prospectus requirement of such securities laws. The Notes have not been and will not be registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and state securities laws.

This press release shall not constitute an offer to sell the Notes or the solicitation of an offer to buy the Notes, nor will there be any sale of the Notes in any state or jurisdiction where such offer, solicitation or sale is not permitted.

About Air Canada

Air Canada is Canada's largest domestic and international airline serving more than 180 destinations on five continents.  Canada's flag carrier is among the 20 largest airlines in the world and in 2013 served more than 35 million customers.  Air Canada provides scheduled passenger service directly to 60 Canadian cities, 49 destinations in the United States and 72 cities in Europe, the Middle East, Asia, Australia, the Caribbean, Mexico and South America. Air Canada is a founding member of Star Alliance, the world's most comprehensive air transportation network serving 1,269 airports in 193 countries.  Air Canada is the only international network carrier in North America to receive a Four-Star ranking according to independent U.K. research firm Skytrax that ranked Air Canada in a worldwide survey of more than 18 million airline passengers as Best Airline in North America in 2013 for the fourth consecutive year. 

Caution Regarding Forward-Looking Information

Air Canada's public communications may include forward-looking statements within the meaning of applicable securities laws. Forward-looking statements, by their nature, are based on assumptions and are subject to important risks and uncertainties. Forward-looking statements cannot be relied upon due to, amongst other things, changing external events and general uncertainties of the business. Actual results may differ materially from results indicated in forward-looking statements due to a number of factors, including without limitation, industry, market, credit and economic conditions, the ability to reduce operating costs and secure financing, pension issues, energy prices, employee and labour relations, currency exchange and interest rates, competition, war, terrorist acts, epidemic diseases, environmental factors (including weather systems and other natural phenomena, and factors arising from man-made sources), insurance issues and costs, changes in demand due to the seasonal nature of the business, supply issues, changes in laws, regulatory developments or proceedings, pending and future litigation and actions by third parties as well as the factors identified throughout Air Canada's public disclosure file available at www.sedar.com.  Any forward-looking statements contained in this news release represent Air Canada's expectations as of the date of this news release and are subject to change after such date.  However, Air Canada disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.

SOURCE Air Canada



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