Thursday, November 13, 2008

AirAsia set to close deal on purchase of 37 planes

PETALING JAYA: As airlines globally struggle to get financing for future aircraft deliveries, AirAsia Bhd says it is close to finalising a deal worth close to RM3.5bil to fund the purchase of 37 new aircraft over the next two years.

Deputy group chief executive officer Datuk Kamarudin Meranun told StarBiz yesterday the airline had given Barclays Capital and BNP Paribas the mandate for the financing.

“It is an ECA-backed (export credit agencies) financing that would fund the next 37 aircraft for which delivery will begin on Dec 19,’’ he said.

“So far discussions have been held with ECA in Paris and we are now going through the documentation process. We hope to sign the financing agreement before the first delivery,’’ he added.

Asked about the borrowing rates, he said they “are very attractive.’’

AirAsia has ordered 175 aircraft with 50 under option. This year the low-cost carrier will take delivery of four more aircraft, followed by 14 next year and 23 in 2010.

AirAsia had debts of RM4.3bil as at end-June and cash reserves of RM1.1bil. The carrier’s net gearing is 1.9 times and analysts expect its gearing ratio to rise with the additional borrowings for the new deliveries.

The airline, which abolished its fuel surcharges on Tuesday, hopes to rev up revenue by selling more seats.

Market talk is that AirAsia, since abolishing its fuel levy, has raised its administrative fees by RM30 to RM70 one-way. This was denied by AirAsia group CEO Datuk Tony Fernandes.

“No, we have not increased our administration fees. It is still the same,’’ Fernandes said.

1 comment:

Anonymous said...

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