AMR ( AMR) has priced an offering of 13 million newly issued common shares at $38.70 each, a discount to the stock's last closing price.

The shares, which finished the previous session at $40.09, were trading Tuesday at $38.11, down nearly 5%.

AMR, the parent of American Airlines, said it granted the underwriters a 30-day option to purchase up to 1.95 million shares to cover overallotments. Credit Suisse, Merrill Lynch and UBS underwrote the deal.

The carrier said the offering is intended to strengthen its balance sheet. It will use the proceeds for general corporate purposes, possibly including debt repayment, funding employee pensions, aircraft acquisitions or other capital expenditures.

Last week, American executives stressed during a conference call that "balance sheet repair" is a top priority, and they said they would review whether to order new jets.

Issuance and delivery of the shares is expected to occur Jan. 26.

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