Credit-default swaps for AMR Corp, parent company of American Airlines, rose to 49.5% upfront yesterday from 29.25% on August 1, suggesting the market considers the airline to be struggling, if not inching closer to filing for Chapter 11. Delta Air Lines and United Continental CDS upfront price is 18%, as a comparison. AMR Corp is expected to pay up on its offering of $725.7 million of debt backed by aircraft – the first such offering since January. The 10-year pass-through certificates will be used to finance aircraft. American Airlines has $828.8 million of 7.858% pass-through certificates maturing on October 1.
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