Flydubai, the Dubai-based no frills airline, has signed a sale and lease back agreement on four Boeing planes with aircraft leasing group, Avolon.
The Boeing 737-800 NG planes are worth US $320 million at list price.
The deal with Avolon follows recent agreements with GECAS and BBAM covering nine aircraft.
Ghaith Al Ghaith, CEO of flydubai, said: “We are delighted to be able to enter into this partnership with Avolon today. Like flydubai, Avolon is a young, ambitious, dynamic company and we look forward to a long and successful relationship with them.”
“This deal for four Boeing 737-800NG aircraft comes just five weeks after our announcement of sale and lease back agreements for nine aircraft with GECAS and BBAM and takes the total value of the financing we have secured during that period to more than US $1 billion. Our next 13 aircraft are now completely financed, which takes us through to December of next year.”
Sale and lease back agreements involve selling an asset that one already owns, or may have agreed to purchase, to a third party and then agreeing to rent that asset from the new owner.
It is a way for firms to avoid large capital outlays while securing access to a product that they need. In some jurisdictions, it is used for taxation or accounting purposes.