Airbnb secures new $1 billion loan on top of $1 billion bond deal
NEW YORK/BOSTON (Reuters) – Airbnb, whose home rental business suffers as the coronavirus pandemic freezes global travel, secured a new $1 billion (£793 million) loan within days only after reaching a $1 billion debt deal, the company said on Tuesday.
Parties to the new loan agreement included private equity firms Silver Lake, Apollo Global Management APO.NSixth Street Partners, Oaktree Capital Management and Owl Rock, multiple sources familiar with the discussions told Reuters.
Silver Lake, one of two investors in the debt deal a few days ago, is “one of the biggest players” in the new deal, one of the sources said.
The terms of the new deal are senior debt, meaning those creditors would be paid first if Airbnb were to default, the sources said. The loan is for five years, with an interest rate of 750 basis points above the Libor benchmark, they said, adding that it was sold at a slight discount to the face value of the loan, which would allow investors to earn a rate of around 12%.
The sources requested anonymity as the matter is private. Apollo, Oaktree, Silver Lake, Owl Rock and Sixth Street declined to comment.
Advisers on the new deal were Morgan Stanley and Goldman Sachs, Airbnb said.
Last week’s $1 billion bond deal with Silver Lake and Sixth Street included warrants for both private equity firms that can be exercised at a valuation of $18 billion.
That figure is lower than Airbnb’s $26 billion cited as an internal valuation in early March and well below the $31 billion valuation it achieved in its Series F fundraising in 2017.
Airbnb said in September that it plans to list its shares in 2020. It has not commented publicly on whether turbulence in the travel industry will impact those plans.
Reporting by Joshua Franklin in New York, Lawrence Delevingne in Boston and Jane Lanhee Lee; Additional reporting by Chibuike Oguh in New York and Aakriti Bhalla in Bengaluru; Editing by Stephen Coates, Edwina Gibbs and Sherry Jacob-Phillips