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Photographer: Patrick T. Fallon / Bloomberg
Photographer: Patrick T. Fallon / Bloomberg
JetBlue Airways Corp. May Move Its $ 3 Billion Credit Card Portfolio From Barclays Plc plans to borrow more from the government to help overcome the Covid-19 pandemic.
The company sent out requests for proposals soliciting bids after Barclays asked the airline to extend its partnership agreement, according to people familiar with the matter. Barclays and Goldman Sachs Group Inc. is vying for the company, the people said, asking not to be identified because the case is private.
“Because we are exploring a route for government loan or a non-government transaction for our future liquidity needs, we needed to expedite a tender for our co-branded credit card,” JetBlue said in a statement Thursday. “Our RFP will help us assess the right partner for us in this new travel landscape as we emerge from this crisis and in light of other co-brand agreements that have taken place since our agreement was last signed. “
The company did not elaborate on the connection between the deliberations on liquidity needs and the partnership with Barclays, and it declined to comment on the companies in the negotiations.
Representatives for London-based Barclays and Goldman Sachs declined to comment. The Wall Street Journal reported the request for proposals earlier Thursday.
Barclays and JetBlue, which is based in Long Island City, New York, still have three years on their current deal, which means any changes wouldn’t take effect immediately. The two have been partners since 2016 and the portfolio has since tripled, according to one.
“We have had an excellent five-year collaboration with Barclays, and the performance of our co-brand card has exceeded expectations,” JetBlue said in the release. “They have been a key partner in our business and in the success of our loyalty program.”
Two cards
JetBlue and Barclays have two cards together. One, with no annual fee, offers perks, including three points per dollar spent on airline purchases and two points per dollar spent at restaurants and grocery stores. The JetBlue Plus card, with an annual fee of $ 99, offers six points per dollar spent with the airline.
Last year, JetBlue became one of the first U.S. carriers to sell loyalty points to its co-branded credit card partner to raise cash, generating $ 150 million from Barclays as the coronavirus pandemic crushed travel demand.
“This is a good time to negotiate, especially given Goldman’s apparent ambitions with its consumer card business following its partnership with Apple in 2019,” Joe DeNardi, analyst at Stifel & Co., said Thursday in a statement. note. “JetBlue’s co-brand opportunity is significant, so we believe they are interested in finding a partner who sees this and is willing to invest aggressively behind it.”
Barclays has sought to diversify its card offerings in the United States, which have long focused on hotels and airlines, and last year signed an agreement to resume a co-branded credit card deal with AARP.
– With the help of Sridhar Natarajan
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