Financially troubled Malaysian cargo carrier Transmile Air Services has agreed to sell four Boeing MD-11 freighter aircraft to FedEx for $68 million to help pay off its debt.
Proceeds from the sale will be used by the carrier's parent Transmile Group to partially repay its lenders, says the airline, adding that the funds would reduce the company's debt by up to 39% to 320.1 million ringgit ($104.2 million).
The four MD-11Fs are "not revenue generating and have been left idle since April 2008", adds the carrier. "The group is unable to verify any viable routes to put the aircraft to service," it says.
According to Flightglobal's ACAS database, the four aircraft were built in 1991 to 1992.
"The idling of the aircraft will continue to be a financial burden to the company due to the fixed parking, storage and maintenance costs and other expenses of approximately 1.18 million ringgit per annum that need to be incurred," says Transmile. It expects to complete the sale by the second quarter of 2011.
Transmile has been struggling to repay its debt since an accounting scandal broke out at the carrier in 2007.
It is now in the process of coming up with a financial regularisation plan after Malaysia's High Court granted an order to restrain all proceedings against the airline temporarily.
The airline has since applied to extend this order twice, with the latest application made on 6 January.
Source: Air Transport Intelligence news
