Air India aims to raise $470 million to fund Dreamliner planes


MUMBAI: National carrier Air India has floated a tender to raise a bridge loan of $470 million (Rs 3,149 crore) for financing the remaining four of its ordered Boeing 787 Dreamliner planes.

The last date of bidding for banks is March 21.

The state-run carrier had in 2005-06 placed an order for 27 Boeing 787 Dreamliner planes as part of the mammoth 111 plane order placed with the american plane maker and its European rival airbus. The deal was valued at $15 billion.

Air India is financing all these planes via sale and leaseback agreements, which means it sells each delivered plane to a lessor at a premium and then leases it back for monthly rentals.

The bridge loan is being raised as an interim funding arrangement until sale and leaseback contracts for the planes is signed.

In the tender document, Air India said it has concluded sale and leaseback agreements for 21 planes which it is currently operating, and tied up for bridge loans for the 23rd and 24th plane which were delivered in November 2016 and January 2017. Sale and leaseback of the two planes is also under process.

The remaining four planes will be delivered between July and October this year. The airline seeks to raise the bridge loan for these planes for a period of 15 months, it said in the tender document.

“Air India would prefer to have a bullet repayment for this facility or a suitable moratorium period for payment of principal amount under this facility. Bidder with the lowest low-inclusive costs would be selected,” the airline said.