Alaska Air Group (ALK) said Monday it launched $1.5 billion mileage plan financing that includes a proposed senior secured term loan facility and pari passu senior secured debt.

The company's AS Mileage Plan IP unit its borrower under the mileage plan financing, according to Alaska Air.

Borrowings under the financing will be used to fund in part the reserve account for the mileage plan financing and a collection account to make intercompany loans to Alaska Air, according to the company.

Alaska Air said it will use the proceeds from intercompany loans to redeem certain debt, for general corporate purposes and support its liquidity position.

Shares of the company were up 3.5% in recent trading.

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