Lufthansa refinanced eight aircraft in the second half of 2020. The transaction has generated €500 million ($613 million) for the German flag carrier, which is continuing to deal with the global aviation crisis’s impact, which has hit passenger numbers and profitability.
2020 threw a lot of unexpected challenges at airlines around the world. Many airlines have been dealing with unprecedented circumstances, from grounding entire fleets to trimming routes and employees to seeking government bailouts. In a bid to raise funds, many airlines have turned to selling aircraft for leaseback, or in the case of Lufthansa, refinancing them.
Eight aircraft used as security
Earlier today, German flag carrier Lufthansa revealed that it had used eight aircraft as security in financial transactions. The aircraft have been refinanced, generating €500 million in funds for the airline. According to a press release, the aircraft refinanced were five A350s and three Airbus A320 family aircraft.
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The funds were raised through sale and leaseback financing, secured loans, and secured promissory notes. The funds came from Banks, private equity funds, and corporate investors from Europe and Asia. The airline goes on to state that it has received attractive terms for the transactions.