After going on a borrowing binge last year, Allegiant Air is taking on more debt.
The Las Vegas-based discount airline today closed on a loan to borrow $30 million, putting up two Airbus A319 aircraft as collateral.
The carrier also obtained a $7.5 million loan from Nevada State Bank on Thursday by mortgaging real estate it bought last fall.
Proceeds from both loans will be used for “general corporate purposes,” the airline’s parent, Allegiant Travel Co., said in a regulatory filing today.
The filing did not disclose the source of the $30 million loan package.
Allegiant spokeswoman Jessica Wheeler said the lender was an Asian bank but declined to identify it.
In a span of just three months last year, Allegiant borrowed $385 million — a hefty amount for the small carrier — largely to buy more Airbus planes.
It sold $300 million in bonds and borrowed another $85 million by mortgaging almost its entire fleet of aircraft, putting 53 MD-80s and six Boeing 757s up as collateral.
The company also assumed $142 million in debt last June in connection with the acquisition of 12 Airbus A320s.
All told, Allegiant had $593 million in long-term debt by the end of last year, up from $234 million at the end of 2013, a regulatory filing shows.
The increased borrowing came as American companies took on debt at a record pace last year amid low interest rates.
U.S. corporate bond sales shot past $1.5 trillion in 2014, a record level, according to Bloomberg News.
Allegiant flies leisure travelers from small, underserved cities to warm-weather vacation spots with almost no competition on its routes. The carrier, known for its low-priced fares and large menu of add-on fees, has been profitable for 12 consecutive years.