Air India to realize Rs380-cr from sale/leaseback of six A310 aircraft

New Delhi: In a move that would help it unlock the value of its assets, international carrier Air India (AI) plans to adopt the sale and leaseback method for six Airbus A-310 aircraft. Towards this end the airline has invited bids under the reverse auction method for the sale and leaseback arrangement from prospective lessors or bankers for the aircraft.

According to reports, AI has already received a bid for $78 million (about Rs380 crore) for the sale and leaseback arrangement for the six aircraft. The bank apparently has quoted a monthly lease rental fee of $247,000 that AI would have to pay for each of the six aircraft. Airline sources have described it as a win-win situation for them as not only does the carrier receive cash from the sale but the aircraft remain in the fleet as well.

The funds, said sources, are likely to be used to replenish working capital requirements, and also to meet loan repayments arising from the acquisition of 68 new Boeing aircraft. According to sources, the airline plans to complete the entire transaction before March 31.

The lease back will be for a period of five years.