The deal will significantly reduce Norwegian Air’s capex requirements.
On Thursday, Oslo-listed Norwegian Air stated, it has struck a deal with China’s CCB Leasing to take joint ownership of a large fleet of aircraft that it has ordered from Airbus.
The development comes in the wake of the cash-strapped carrier’s earlier statement that it was looking for a partner to help take ownership of the Airbus fleet.
As part of the deal, CCB Leasing Corporation DAC (CCBLI), a wholly owned subsidiary of China Construction Bank Corp, will have a 70% stake in the joint venture, while Norwegian Air’s Arctic Aviation will own the balance 30%.
“Under the terms of the agreement, the joint venture will purchase from Arctic an initial 27 Airbus A320 NEO aircraft to be delivered from 2020 to 2023,” said Norwegian Air. “In addition to a positive equity effect, the joint venture will reduce Norwegian’s committed capital expenditure by approximately $1.5 billion based on the initial 27 aircraft”.
In a statement, Geir Karlsen, Norwegian Air’s acting CEO stated, “This agreement will contribute significantly to reducing our current and future capital expenditure”.