ANDREW DOYLE / PARIS
A slice of Debis AirFinance is for sale, while ILFC is poised to swoop down on Swissair's aircraft management unit
A further round of consolidation in the aircraft leasing sector is looming following DaimlerChrysler's decision to put its 45% stake in subsidiary Debis AirFinance up for sale, and a move by financially troubled Swissair to offload major parts of its Flightlease portfolio.
US giant International Lease Finance (ILFC), tipped to take over several Flightlease commitments, including Airbus A340-600s earmarked for Swissair, has meanwhile ordered an additional 110 aircraft from the European manufacturer.
Industry sources say ILFC also approached Boeing to discuss a major follow-on order for 737s and 777s, but was rebuffed due to the manufacturer's concerns its leasing company backlog would have reached an unacceptably high level.
The sources say Boeing is not prepared to allow the proportion of its backlog accounted for by leasing companies to exceed 40%, and subsequently failed to close a deal for a smaller number of 737s and 777s which it offered to ILFC.
Boeing declines to comment on its discussions with ILFC other than to say that "we are still talking to them". ILFC was not available for comment.
The Los Angeles-based firm announced an $8.7 billion order at last week's Paris air show for 110 aircraft for delivery from 2002. The deal includes 10 Airbus A380s, 21 A330-200s and 80 A320-familyaircraft.
The deal contributed heavily to Airbus's eclipsing of Boeing at Paris in terms of announced orders. ILFC is also purchasing a single A340 from Swissair's struggling Belgian affiliate Sabena.
ILFC declined to reveal potential customers for the newly ordered aircraft, including five previously-announced A380 passenger models and five new orders for A380 freighters.
ILFC has the right to convert some or all the A330s to a freighter version if it is launched.
ILFC becomes the first leasing company to place firm orders for the 550-seat A380. "Our focus will be on existing Boeing 747 operators," says ILFC chairman Steve Udvar-Hazy.
In a separate move, ILFC is discussing an imminent purchase of around 15 aircraft from Flightlease, possibly including the bulk of the nine A340-600s ordered for operation by Swissair.
Industry sources suggest that Airbus is helping to broker a deal between ILFC, its biggest single customer, and the Swiss flag-carrier in an effort to protect one of the key launch orders it holds for the stretched, longer range A340.
Swissair is believed to be aiming to conclude a deal by the end of June, so that the financial impact will be reflected in its first halfbalance sheet.
ILFC has already placed a pair of A340-600s with Swissair as part of an earlier deal.
Swissair has also decided to sever ties with GATX of the USA, its partner in the GATX-Flightlease joint venture, which currently has 58 aircraft on order and option. The latter will be disbanded and the Swiss group will assume control only of those aircraft operated by Swissair and its regional subsidiary Crossair.
GATX says it will "work closely with Flightlease to address the partnership structure and any issues regarding jointly owned and ordered aircraft."
A full disposal of Flightlease is not being ruled out by Swissair.
Meanwhile, DaimlerChrysler has reportedly retained Goldman Sachs to advise it on the sale of its 45% stake in Debis AirFinance, which has a portfolio of 220 jet and turboprop aircraft. The bulk of the remaining shares are held by German banks. ILFC is seen as a potential suitor for Debis.
Source: Flight International
