Tata to buy a complete of 470 plane from Boeing and Airbus, and Air India has additionally contributed fairness.
| Photo Credit: Reuters
Japanese lender Sumitomo Mitsui Banking Corporation (SMBC) on December 20 mentioned the Tata Group-owned Air India has borrowed $120 million from it for buying a wide-body plane from Airbus.
“The transaction has partly financed Air India’s purchase of an A350-900 aircraft from Airbus, which was delivered in October 2023,” in accordance to an official assertion.
SMBC mentioned this can be a secured debt facility by its Singapore department, whereas Air India’s GIFT City-headquartered arm AI Fleet Services is the borrower. The buy is a part of the mega announcement by the Tatas to buy a complete of 470 plane from Boeing and Airbus, and AI has additionally contributed fairness.
According to some studies, an Airbus A350-900 plane is priced above $300 million. “SMBC Group is pleased to expand upon its long-established relationship with Tata Group through this deal,” the lender’s nation head for India Hiroyuki Mesaki mentioned.
Nipun Aggarwal, Air India’s Chief Commercial and Transformation Officer, mentioned the plane was among the many first deliveries within the firm’s giant plane order introduced earlier this 12 months.
“This transaction is also a major step in expanding our aircraft financing business through GIFT City, India’s first International Financial Services Centre (IFSC),” Mr. Aggarwal added.
The SMBC assertion mentioned India is the fifth largest aviation market globally, and the sector is predicted to proceed rising considerably on tailwinds like emergence of a giant and rising middle-class keen to journey.