Russia’s Sukhoi Civil Aircraft has long claimed its Superjet 100 offers a level of technical sophistication that surpasses that of any Western regional jet on the market. Now, a new funding system state-controlled Vnesheconombank (VEB) devised with Sukhoi to support export sales of the Superjet 100 promises to place the Russian regional jet on equal footing with Western models in terms of financing cost as well, according to VEB deputy chairman Alexander Ivanov.
Financing, Insurance and Taxes » Aviation Financing
Issues regarding financing of aircraft.
Southeast Asian carriers VietJetAir and Myanmar Airways maintained the region’s strong growth-curve yesterday, announcing new airliner deals worth almost $7.4 billion. At the Singapore Airshow, Vietnam’s VietJetAir gave Airbus a $6.4 billion contract covering firm orders for 42 A320neos, 14 A320ceos and seven A321ceos.
The Air Line Pilots Association sent a letter Tuesday to Senate Banking Committee chairman Tim Johnson (D-S.D.) and ranking member Mike Crapo (R-Idaho) urging the committee to impose tighter oversight on the Export-Import Bank of the United States and Congress to work toward eliminating financing for widebody aircraft to foreign carriers.
The bankruptcy of Danish airline Cimber Sterling in May 2012 has threatened to shake the foundation of the country’s engine leasing business after a Danish bankruptcy court ruled that some of the engines fitted to Cimber Sterling aircraft belonged to the airframes and the engine lessors bore no right to them, according to lawyers representing the leasing entities.
On the heels of secured note private placement that brought in $575 million in cash earlier this week, helicopter lessor Milestone Aviation Group announced today that it has closed on an unsecured $200 million revolving credit line. This new facility increases Milestone’s unsecured borrowing capacity to $450 million and revolving borrowing capacity to $800 million.
Helicopter lessor Milestone Aviation Group announced today that it has successfully completed the private placement of $575 million of senior secured notes. The company intends to use the proceeds to fund the continued expansion of its business and to refinance existing debt. Seventeen investors, 16 of which are new to Milestone, participated in the private placement. The deal positions Milestone “to continue delivering for our operating partners for years to come,” said company president Daniel Rosenthal.
Airlines will continue to enjoy ready access to financing for new aircraft acquisitions, as funding sources such as bonds grow in importance as options for financial support, according to Boeing’s seventh annual aircraft finance market forecast. The report, released in London on December 10, said that while export credit agency funding will decline in significance in the coming years, the industry will see a more even balance among carriers’ use of bonds, leases and loans from banks and capital markets.
Traditional measures point to a recovery in the economy in general, but the business aviation sector has yet to enjoy it. On the up side, credit has loosened somewhat for newer aircraft, as lenders find niche markets for themselves. For many buyers, however, cash remains king.
With 36 A380 aircraft in the fleet as of late September and a further 104 now on order, the aviation community is trying to calculate what will happen to Emirates’ superjumbo fleet when the time comes to retire the type, at around halfway through its lifetime. Some analysts believe that, given a lifespan of 25 years, a proxy for the useful life of a modern widebody aircraft, the A380 will face problems in the secondary market when major leases come to an end after the standard 12-year term.
The dynamism of today’s airliner leasing business was illustrated earlier this year by the creation by German investment company Doric GmbH of a separate entity, Doric Lease Corp. (DLC), to manage the assets.
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