Mon, Sep 22, 2008
Maxing Out Three Credit Lines Raises $6.5 Billion In Emergency
Funding
International Lease Finance Corporation is borrowing a total of
$6.5 billion against its three credit lines to help keep the
company solvent into the first quarter of 2009. The funds were
requested on September 16 -- the same day its parent company,
American International Group,
obtained an $85 billion loan from the US
government.
The loan has served to bolster confidence in ILFC, according to
Bloomberg reports, with credit-default swaps on ILFC down 97 basis
points, and contracts on the NAIG Index down 30 points. Major
aircraft manufacturers are also expressing their trust in ILFCs
liquidity, as second-quarter operating income grew to $352 million,
an 85 percent increase attributed to fleet expansion and increased
rental rates.
Airbus SAS CEO John Leahy said that he is confident that ILFC,
which is Airbus' biggest customer, will take delivery of ordered
aircraft. Boeing spokesman John Dern said, "We haven't seen
anything that fundamentally changes expectations for financing and
delivering our backlog... with our leasing customers." ILFC
currently has 102 aircraft on order from Boeing.
Speculation continues as to whether former CEO and founder of
ILFC Steven Udvar-Hazy will try to buy the company back from AIG,
as ANN reported. Prior to the federal
takeover, analyst Alain Karaoglan had recommended that AIG sell
ILFC, predicting the sale might bring $7 billion to $14
billion.
Speaking about the recent loan, credit analyst David Havens
said, "This ups the volume on the need for ILFC to be sold to a
well-financed buyer. ILFC needs liquidity to survive, and this is
its final source of liquidity."
Repayment of the first of the three credit lines is due by
October 2009.
More News
Aviation Governance Secured...At Least For a While The National Business Aviation Association similarly applauded the passage of the FAA's recent reauthorization, contentedly recou>[...]
Emphasis On Growing The Future of Aviation Through Concentration on 'AFFORDABLE FLYERS' It's been a number of years since the Latest Edition of Jim Campbell's HUGE SportPlane Resou>[...]
Amazilia Aerospace GmbH, Develops Digital Flight Control, Flight Guidance And Vehicle Management Systems Textron eAviation has acquired substantially all the assets of Amazilia Aer>[...]
Honeywell's Primus Brings New Tools and Niceties for Hawker Operators Hawker 4000 business jet operators have a new installation on the table, now that the FAA has granted an STC f>[...]
Company Celebrates Niche-but-Important Advancement in Industry Standards Echodyne has announced full integration of its proprietary 'EchoFlight' radar into the e American Aerospace>[...]