SAS and GECAS form Joint Venture for fleet management
SAS and GECAS form Joint Venture for fleet management - to increase SAS operational and financial flexibility To increase SAS operational and financial flexibility SAS and GECAS (General Electric Capital Aviation Services) have formed a Joint Venture for fleet management. The Joint Venture is established with 30 McDonnell Douglas MD 80 aircraft currently owned and operated by SAS. The Joint Venture, named Commercial Aviation Leasing Limited (Ireland) is established in cooperation with GECAS and GE Capital Corp. (GECC) and the Joint Venture is primarily owned by SAS and GECC. Increased financial and operational flexibility The transaction will significantly increase SAS financial and operational flexibility within the medium size fleet. SAS will continue to operate the aircraft, and they will be leased back for a specified time period. SAS also holds flexible extension options. The aircraft were originally delivered to SAS in the period 1985-1992. In summary, the Joint Venture structure will provide a lower overall cost of capital to SAS. The capital commitment on the part of SAS will be lower, taking lease commitments into consideration, and the future current cost will be lower compared to the present situation. Henry Hubschman, GECAS president. and Gunnar Reitan, Executive Vice President & CFO, SAS Group says in a joint statement: "This transaction and the progressive nature of merging airline and lessors expertise meet both parties' requirements in financial and fleet flexibility terms" Gain on sale approximately SEK 500 million In addition to the above transaction SAS has completed sale and leaseback of 6 Boeing 737-600 with a leasing company. The two transactions release capital and generate sales proceeds in excess of SEK 4000 million and gains on sale of approximately SEK 500 million. The future leasing costs will be lower than if the aircraft were owned. About GECAS: GE Capital Aviation Services (GECAS), a wholly owned subsidiary of General Electric Capital Corp (GECC), is the world's leading aviation solutions provider with a fleet of over 850 planes leased to 175 airlines in 60 countries. The customers include major flag carriers, large scheduled passenger carriers, charter operators, low fare carriers, regional jet operators, cargo carriers, and selected start-ups. For further information, please contact: Gunnar Reitan, Executive Vice President & CFO Tel: +46 (0)8 797 2844/ +46 (0) 70 997 2844 ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/12/23/19991223BIT00200/bit0001.doc http://www.bit.se/bitonline/1999/12/23/19991223BIT00200/bit0002.pdf