SAN FRANCISCO: Home-sharing leader Airbnb Inc lined up US$1bil in debt, adding to last week’s same-size haul and boosting a financial cushion it can use to grow and pay bills as the global coronavirus pandemic crushes demand for travel and diminishes the prospect of an initial public offering.
Airbnb is raising cash by issuing first-lien debt, which has priority on the company’s assets in case of a default, and it comes from a group of more than 20 investors, including Silver Lake, the largest participant, according to people with knowledge of the matter. Other investors are BlackRock Inc, Eaton Vance Corp, Fidelity Investments and T. Rowe Price Group Inc, said sources.
The company confirmed in a statement it had secured commitments for a US$1bil syndicated loan but didn’t name investors or elaborate on details.
San Francisco-based Airbnb, which makes money from homeowners who rent residences to travelers, had been planning to go public some time this year, but the outbreak of Covid-19 has sent markets into a tailspin and made an IPO less likely.
People around the world have put travel plans on hold as governments issue shelter-in-place edicts to stop the contagion, slowing sales growth and crimping profit at Airbnb.
The additional funds could help the company weather the economic crisis and even make acquisitions without going public. — Bloomberg
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