Jet in talks for aircraft sale & leaseback

Mumbai: With the Bombay high court clearing the decks for settlement of its long-standing feud with Sahara, Jet Airways has initiated talks for sale and lease back of some of its Boeing aircraft.
The Naresh Goyal-promoted company is also hopeful of closing the development deal for its Bandra Kurla Complex (BKC) plot in Mumbai in two weeks.
“The airline is in talks for a sale and lease back for some of the planes and there are proposals for the entire fleet, but we will not go for all of it in one shot,” a senior official stated during an earnings call on Friday.
Jet has 21 aircraft available. A sale and lease back is expected to bring in cash flow of $8-9 million per aircraft.
Company officials said the number of planes for this kind of an arrangement has not been decided. Sale and lease back is a common practice amongst airlines wherein the carrier sells its aircraft to leasing companies at a higher value and leases them back at monthly rentals.
The airline is also optimistic of selecting a developer for its BKC plot in two weeks. Godrej Properties and Jet Airways were in talks to develop this plot.
21/05/11 Amritha Pillay/Daily News & Analysis

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Categories: Jet Airways May 2011