Another US airline is in the market looking for sale and leaseback (SLB) financing, but one financier questions the lease terms involved in recent deals.
Sources indicate US Airways is in the SLB market with Airbus A321 aircraft. The airline is said to be looking for pricing at around $48 million with 10-12 year tenors and no maximum reserves.
American Airlines and Alaskan Airlines have also been active in the SLB market with similar length lease terms. In a deal with BOC Aviation in January, Southwest sold five Boeing 737-700 aircraft for a total of approximately $175 million and immediately leased the aircraft back for a period of 16 years.
"Why pay the premium of an operating lease when you are going to commit to a tenor of that length. The whole idea is to pay for flexibility, so in 5-7 years when the cycle turns again, the airline can dispose of the aircraft easily, without have to restructure its debt obligations," says the source.
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Source: Commercial Aviation Online
