Avation announced the execution of a sale and purchase agreement with an airline client for the next two ATR 72-600 aircraft deliveries from the manufacturer. This agreement follows the earlier exercise of purchase rights under Avation’s long-term aircraft purchase contract with ATR.
Jeff Chatfield, Executive Chairman, stated: “The Company primarily operates as an aircraft lease provider and generally prefers to lease commercial aircraft to airlines for an appropriate period. However, the Company is occasionally willing to dispose of aircraft when valuations are favourable. The decision to sell these next two deliveries was driven by attractive economic considerations. The Company anticipates net cash proceeds of over $10 million upon the completion of the sale of these two aircraft, with these funds earmarked for pre-delivery payments for Avation’s ten-aircraft ATR 72-600 order.
“We are pleased that this airline is based in the Americas, which we believe is a promising market for a significant number of ATR 72-600s.
“Avation remains committed to establishing a ten-year programme for the supply of new regional aircraft with favourable economics as a core component of our long-term business strategy. ATR 72s, with their low operating costs and leading low carbon emissions credentials, are an essential addition to the regional networks of almost all major airlines.”
The sale of these aircraft is contingent upon customary conditions precedent and is expected to be completed upon delivery from ATR, scheduled for the fourth quarter of 2024 and the first quarter of 2025. Avation has received two cash deposits from the airline in relation to this transaction.
Following the completion of this sale, Avation will have ten ATR 72-600 aircraft remaining on order for delivery from ATR between the last quarter of 2025 and 2028. Additionally, Avation retains purchase rights for a further 24 aircraft, with an extended expiry date of June 2034.
