Marriott International has signed amendments to its existing co-brand credit card agreements with JPMorgan Chase & Co. and American Express. These amendments will provide the company with $920 million of cash, further enhancing its liquidity, with $570 million coming from Chase and $350 million coming from American Express.
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The $570 million from Chase includes $500 million of prepayment of certain future revenues and $70 million from the early payment of a previously committed signing bonus under the co-brand credit card agreement. The $350 million from American Express is for the prepurchase of Marriott Bonvoy points and other consideration. In each case the cash will be recorded by Marriott as deferred revenue and will be available for general corporate purposes.
Both amendments include extensions of the existing co-brand credit card agreements, so they continue to be co-terminus.
The company also has terminated the $1.5 billion 364-day revolving credit facility commitment it announced on April 14, 2020, the capacity of which was substantially reduced as a result of the Series EE senior notes offering the company completed on April 16, 2020.
Marriott’s move follows a similar one by Hilton, which raised $1 billion from an advance sale of loyalty points to its co-brand credit card partner, American Express. In a Securites and Exchange Commission filing dated April 16, the company said that the sale contributed to cash of around $2.8 billion, which would provide it with adequate liquidity to fund its operations over the next 18 to 24 months.