JetBlue Begins $2.75 Billion Debt Sale, Gets Two Downgrades (3)

JetBlue Airways Corp. has kicked off a $2.75 billion bond-and-loan sale backed by its loyalty program as the carrier seeks to raise reserves and fund general corporate purposes.

Meanwhile, Moody’s Ratings and S&P Global Ratings both downgraded the airline to one notch about triple C levels. JetBlue not having such grades is key because collateralized loan obligations — the biggest buyers of leveraged loans — have limits on how much of the riskiest junk debt they can own.

Shares fell as much as 19% Monday as the carrier said it plans to sell at least $400 million of five-year convertible ...