By NNN-Bernama,
Kuala Lumpur, Malaysia : Malaysia Airlines success in securing finances worth US$126 million under the Japanese Operating Lease for seven ATR72-500s aircraft was named “Aircraft Leasing Deal of the Year – Asia” by Jane Transport Finance.
Working with BNP Paribas Corporate and Investment Banking (“BNP Paribas”), the JOL transactions were closed at a time when the global financial markets were in a crisis.
The success in securing the financing was especially significant in light of a very quiet Japanese equity market.
“Our success in securing seven Japanese Operating Lease (JOL) since September 2008 in this difficult economic environment coupled with the thin equity market in Japan is a recognition of the strength and depth of our relationship and excellent reputation in the Japanese market.
“This shows the confidence that the financiers have in our healthy financial position and our prospect for growth,” said Malaysia Airlines Chief Financial Officer, Mohd Azha Abdul Jalil in a statement on Sunday.
He added, “This is an excellent start to our financing exercise as we will require more financing for our fleet replacement programme.”
In addition to the ATRs, Malaysia Airlines has ordered 35 B737-800 with delivery commencing end of 2010.
BNP Paribas’ Global Head of Transportation Finance, Eric Eugene, said: “We are delighted that the financing has been granted this award. The financing structured as a JOL found very strong interest in the Japanese market despite the period of financial instability during which it was closed.”
“It is also remarkable insofar as it was the first time that MAS was returning in the aircraft financing market in many years. It is quite unusual for ATR aircraft to be financed through the JOL market and this was made possible thanks to the excellent recognition of MAS in the Japanese equity market,” he said.
JOL is an unique aircraft financing structure whereby the financier takes the form of a special purpose vehicle (“SPV”), which acquires title of the aircraft, and leases the same to Malaysia Airlines on operating lease terms.
The SPV will obtain its equity through syndication of diversified sources from the Japanese equity market, to part finance the aircraft costs and the balance will be funded by loan provided by BNP Paribas and Credit Industriel et Commercial.
The JOL has a call option embedded and upon exercising such call option, the ownership of the aircraft will be transferred to MAS.
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Jane’s Transport Finance Awards are hosted by Jane’s and are established to recognise the immense effort and skill of financiers, bankers and lawyers working within the transport finance industry.
Awards are given in the aircraft, airport, rail, road and shipping sectors. Winners are judged on a specific deal which demonstrates that their finance house or bank has shown particular innovation and skill in securing finance for transportation assets.
The awards are judged by a panel of leading experts and Jane’s Transport Finance editorial team. The Awards continue to recognise the immense effort, skill – and risk sometimes – which goes into structuring the shape of the global transport industry of tomorrow.