The home rental business startup Airbnb succeeded securing a new $1 billion loan in a latest move, just days after successfully closing a $1 billion debt deal, as unveiled the company on Tuesday.
Airbnb has been facing its business badly impacted by the pause in global travelling due to coronavirus pandemic.
Private equity firms including Apollo Global Management, Silver Lake, Owl Rock, Oaktree Capital Management and Sixth Street Partners were the parties to the new loan deal, reported Reuters, citing several sources.
In the days ago debt deal, Silver Lake participated as one of the two investors and it is also “one of the biggest players” in this new deal too, one of the sources told Reuters.
Airbnb agreed upon the term of first lien debt, which will benefit these creditors in case of any bankruptcy as they will be given top most priority while making payments if that happens, said the sources.
The loan provided is at an interest rate of LIBOR + 750 basis points and is for a time span of five years, which will be earning in an interest rate of about 12% for the creditors, they added.
Airbnb confirmed that Goldman Sachs and Morgan Stanley were its advisers on the new deal.
Sixth Street and Silver Lake will be issued with warrants in the previous bond deal of $1 billion by Airbnb in last week, which could be exercisable by the equity firms at a valuation of $18 billion.
The amount of valuation is below the internal valuation amount of $26 billion cited the company in early March and is much below the figure of $31 billion it was valued at in 2017 Series F funding round.
Airbnb unveiled in September last year that it was intending going public in 2020, but in the current scenario of virus outbreak, the company did not discuss any details about impact on those IPO plans.