Last week, US airline Silver Airways announced it raised $50 million of new capital and has completed some strategic objectives that will position it for a strong future. As it now looks ahead, the airline is positioned well to expand its regional network and take advantage of new opportunities that may arise.

Silver Airways raises $50 million

Silver Airways successfully raised $50 million of new capital. This came through the placement of senior secured convertible notes, which will support the carrier's business plan and capital structure. It also plans to use some of the proceeds to fund future growth.

Senior secured convertible notes are one tool that airlines can use to raise funds. They are issued notes with the option for the note to be converted into a preset amount of the issuer's shares.

It is categorized as debt for the airline, but access to this kind of investor funding is relatively easy and positions it for growth. The financing was arranged by Jefferies LLC aviation banking team and, according to the airline, was fully subscribed to by funds and accounts managed by Brigade Capital Management.

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Silver Airways completes other strategic objectives

The funding is part of a broader corporate initiative puzzle. The airline also benefited from some fleet-related moves. This includes new or amended aircraft leases with all of Silver's aircraft lessors, which gives the airline added financial and operational flexibility. At the same time, it received two factory-new ATR 42-600s in December 2021, bringing its -600 fleet to eleven aircraft, with plans to grow this fleet even further in 2022. It also expanded passenger service in Florida, Georgia, South Carolina, and Louisiana.

Another bright spot came from regulators. The airline received regulatory approval to start flying ATR aircraft in cargo operations. As part of this, Silver Airways placed five ATR 72-500s into cargo service under commercial contract in late 2021. This allowed the airline to fly cargo ahead of the busy holiday season.

Silver has had long-standing relationships with multiple airlines. A recent strategic initiative included expanding its codeshare relationship with United Airlines to include all Silver Airways markets in the Caribbean and additional routes in the Southeastern United States. This gives the airline access to additional feed through bookings from United.

Lastly, the airline acquired Seaborne Airlines in 2018. Seaborne is based in Puerto Rico, and recently, Silver Airways finalized the integration of Seaborne into Silver's operations.

President and CEO, Steven Rossum, stated the following on the recent milestones:

“After the most extraordinary period in commercial aviation history, we are humbled and energized by achieving these transformational initiatives. With new, long-term financing, a fleet portfolio comprised of young, fuel efficient, and environmentally friendly aircraft, the final integration of our San Juan-based subsidiary Seaborne Airlines, and our new cargo operations all in place, Silver is now positioned to execute on its tremendous opportunities in the regional passenger and cargo sectors.”

About Silver Airways

Silver Airways is a regional airline that primarily flies turboprops. This includes ATRs, some Saab turboprops, and seaplanes. With this fleet, the airline provides short-haul hops across the southeastern United States and into the Caribbean. Below is a map of the airline's passenger operations this month:

Silver Airways has codeshare agreements with several major airlines. This includes United, JetBlue, American, Delta, Avianca, and Copa. It also has interline agreements with Air Canada, Alaska Airlines, ANA, Azul, Bahamasair, and Emirates, among others. With access to this feed plus local demand, the airline aims to connect underserved short-haul routes and provide expanded access from some smaller communities.

Silver Airways has a lot of growth opportunities. The airline's fleet of ATR aircraft is efficient and can help unlock expansions of frequency and new route opportunities to more destinations. With access to $50 million, backing from investors, and airline partnerships, the sky is the limit for the carrier.