Emirates settles financing terms for new acquisitions
01 Jun 2011
Emirates Airline has settled lending terms for delivery of new aircraft even as it prepares to expand its fleet with Airbus 380 superjumbos and Boeing 777-300ERs. It will likely tap the bond market for additional cash in the near future as well.
The cash injection comes even as the airline preparing to take delivery of two jets a month from next year, over the coming six years. Emirates said last year it would need more than $28bn through to 2017 for its fleet expansion plans.
The Dubai airline completed an agreement with three foreign banks for the financing of 10 wide-body, long-haul jets from Airbus and Boeing, worth $3 billion (Dh11.01bn) at list prices before discounts.
Germany's Doric Asset Finance, Natixis of France and San Francisco-based Jackson Square Aviation, will finance the five A380s and five 777s, scheduled for delivery by July next year.
Emirates has also struck an agreement with Dubai Aerospace Enterprise (DAE) for the lease of seven new Boeing freighters, including two 747-800Fs and five 777s. Emirates did not say when it planned to take delivery of the aircraft.
Senior Emirates officials have said the airline was in a comfortable financial position and held cash reserves of Dh16bn ($4.35 billion). Its bond sale is expected to be in the region of around $500 million.
The airline has just reported its most profitable annual results, with the 12 months ending in March yielding a Dh5.93bn ($1.62 billion) profit as it carried record numbers of passengers and freight.