UAE: Dubai Aerospace Enterprise Sold 16 Boeing At $900 million

Dubai Aerospace Enterprise, the Middle East’s largest aircraft lessor, signed agreements to sell 16 Boeing and Airbus aircraft worth $900 million that will be used to repay debt and fund growth plans.

The three deals for the sale of 737, A320, A330 and A350 jets are expected to close in the second half of the year, Dubai Aerospace Enterprise said in a statement on Wednesday.

This divestment activity will help us optimise our portfolio composition and monetise some of our recent larger-scale investments, Firoz Tarapore, chief executive of DAE, said.

The state-owned company is in talks with Airbus and Boeing for an order of another 400 narrow-body aircraft worth more than $40 billion at list prices.

DAE is growing its fleet further after it acquired Dublin-based lessor Awas last year in a deal that propelled it to the top ranks of global aircraft lessors, raising its portfolio to nearly 400 planes worth $14bn.

The deals for the sale of 16 aircraft will not impact DAE’s total number of customers, Mr Tarapore said, without revealing the buyers in the agreement.

The planes have an average age of two years and are currently on lease to 11 airlines in 11 countries.

DAE Capital, the leasing arm which signed the three agreements, has formed an asset management unit that will seek to build a $5bn portfolio of assets in the coming years, the company said in January.

Last week, the lessor signed a deal for an unsecured revolving credit facility of an initial $480mn, that can be extended up to $800mn, as it seeks to diversify its sources of funding.

It is also considering the issuance of a $500m sukuk and could tap the market either later this year or in 2019, depending on market appetite, Mr Tarapore said in April.

In 2017, DAE raised $2.3bn in senior bonds split across three tranches in the United States to fund its acquisition of Awas.


Tourism Observer

RUSSIA: Nordwind Airlines Wants Two Boeing 777-300ERs

Russian carrier Nordwind Airlines is leasing two Boeing 777-300ER widebody airliners from Dubai-based lessor DAE Capital,part of Dubai Aerospace Enterprise.

The aircraft were previously operated by EVA Air of Taiwan, DAE Capital reports.

To implement its feeder strategy, which covers 200 destinations, in the coming fall-winter season, Nordwind Airlines continues to expand its widebody fleet and is preparing to put two Boeing 777-300s into operation.

The first of the two aircraft is to arrive at the airline’s home base Sheremetyevo on August 31. Following the requisite customs procedures, in early September the airliner will start performing charter flights from Moscow.

The carrier will receive the second aircraft next week.

The two Boeings, to be registered as VP-BJL and VP-BJO, were built in 2005. They will become the first airliners in Nordwind’s fleet to have a three-class cabin layout - 312 seats in total: 38 in business, 63 in premium economy, and 211 in coach.

Nordwind already operates four Boeing 777-200s, which seat 393 passengers in two classes.

The new addition will bring the carrier’s total fleet up to 22 aircraft. It also has Airbus A330-200s, A321s.

Additional four airframes are expected to be delivered by year-end.

Nordwind’s passenger traffic grew 85.4% year-on-year in January-July 2017, reaching 1.598 million; its seat load factor droped by 2.9 percentage points to 86.9%.



Tourism Observer

IRAN: Iran Signs $16.6-billion For 80 Boeing Passenger Jets

European plane maker Airbus and IranAir will finalise a deal to buy aircraft in two weeks, the head of Iran’s flag carrier said on Tuesday, adding Airbus has agreed to arrange financing for the first 17 planes.

Uncertainty over financing of the deal and political opposition in the United States against Iran have slowed down Tehran’s efforts to import aircraft following the lifting of nuclear-related sanctions this year.

Iran signed a $16.6-billion deal for 80 Boeing passenger jets on Sunday and was said to be close to a deal with Airbus, in the biggest package of firm contracts with Western companies since Iran’s 1979 revolution.

IranAir chief executive Farhad Parvaresh said he hoped to finalise the deal with Airbus in two weeks.

“There are only a few small remaining issues like financing. Airbus has agreed to provide financing for 17 planes,” IranAir chief executive Farhad Parvaresh said.

The first contract is expected to involve some 50-60 jets out of 118 provisionally ordered during a visit to France by Iranian President Hassan Rouhani in January.

An Iranian official said in November that IranAir had reached a deal with a foreign leasing company to finance the first 17 jets from Airbus, boosting the prospects of finalising a deal to buy European aircraft.

Dubai’s DAE Capital has been closely involved in the talks in coordination with Airbus, according to industry sources, but the leasing company has declined to comment.

Parvaresh said IranAir was trying to get first five Airbus planes before March 2017, the end of the financial year.

Such a timetable would mean the first new passenger jets reaching Iran ahead of presidential elections in May, widely considered a key objective for pragmatist president Rouhani who has faced hardline opposition to the aircraft deals.

Further details meanwhile emerged of Iran’s deal with Boeing, which depends partly on further financing agreements.

Parvaresh said Boeing had agreed to finance the first six planes it sells to Iran.

He also said Iran would pay for 15 per cent of the value of the jets from its development fund, with the rest to be financed externally.

Industry sources expect Boeing, which faces Republican criticism over trade with Iran, to deal with Iran via foreign lessors or other financiers in order to avoid infringing core US sanctions restricting use of the US financial system.