The Export Credits Guarantee Department (ECGD) is supporting its first Airbus aircraft financing deal with Russia’s Aeroflot which will begin with the purchase of four A319 aircraft as part of a 18-strong order.

ECGD, the UK’s official export credit agency, is providing an export credit guarantee on a $24 million (£18.5 million GBP) bank loan to Aeroflot which it will use to finance the contract worth approximately $170 million (£114 million GBP) under the initial four aircraft deal.  

ECGD’s support for the contract will cover the parts of the aircraft manufactured in the UK - i.e. the wings which are manufactured at Airbus UK’s Broughton facility in North Wales.

Mike O’Brien, the Minister for Trade, said: “I am extremely pleased that Airbus has managed to break into a new market that has traditionally bought aircraft from its competitors.

"The European Airbus consortium has been able to win this important business in a competitive global market place with the support of ECGD,” he added.

In total, Russia’s national airline is buying 13 aircraft, and will lease a further five aircraft from operating lessors.

Airbus said: “It is very important for Airbus to anchor a substantial part of the A319 fleet within Aeroflot, not only via operating leases but also for part of the order by way of long term export credit agency financing. ECGD played a key role in supporting Airbus in order to achieve this goal.”

Citigroup has provided the UK element of the bank loan. The remainder of the bank loan package is being financed by BNP Paribas, Citigroup and WestLB - supported by the Export Credit Agencies of France (Coface) and Germany (Euler Hermes).

Citigroup’s Selma Storm added: “The invaluable assistance provided by ECGD has played an important part in the successful conclusion of the sometimes complicated negotiations.”  

The financing deal for these four Airbus aircraft uses normal asset-based financing techniques, with a leasing structure and security over the aircraft.

NOTES TO EDITORS

1. ECGD, the Export Credits Guarantee Department, is the UK’s export credit agency. A separate Government Department reporting to the Secretary of State for Trade and Industry, it has more than 80 years’ experience of working closely with exporters, project sponsors, banks and buyers to help UK exporters of capital equipment and project-related goods and services. We do this by providing:

• Insurance against non-payment to UK exporters;
• Help in arranging finance packages for buyers of UK goods by guaranteeing bank loans; and,
• Overseas Investment Insurance - a facility that gives UK investors up to 15 years’ insurance against political risks.

2. More information on ECGD’s products, along with other press releases, is available on its website www.ecgd.gov.uk

3. For further details about Airbus - a consortium comprised of BAE SYSTEMS and EADS - visit the company’s website at www.airbus.com

4. For further details about Citigroup’s involvement in this deal, contact Selma Storm on Tel: 020 7986 4868.

Press Enquiries:

Azara Bibi, ECGD Press Office, Tel: 020 7512 7421

(Out of Hours: 07790 887852)