Virgin Atlantic (VS, London Heathrow) will sell and leaseback two of its B787-9s to raise a “cash enhancement” of up to GBP70 million pounds (USD94 million), a spokesperson confirmed to Sky News on December 8.
The deal is with Dublin-based lessor Griffin Global Asset Management with Bain Capital's backing. The same American private investment firm recently secured a separate AUD3.5 billion Australian dollar (USD2.6 billion) acquisition of Virgin Australia (VA, Brisbane International). Bain is also a shareholder in Virgin Voyages, Virgin Group’s yet-to-sail ocean cruises venture.
Virgin Atlantic, which currently operates a fleet of seventeen B787-9s according to the ch-aviation fleets module, concluded its own GBP1.2 billion (USD2.6 billion) rescue deal during the summer.
The Dreamliner sale-and-leaseback operation will create extra liquidity for Virgin Atlantic. The proceeds will also pay off some of the debt the carrier accumulated as part of its recapitalisation, the spokesperson explained in a statement.
“On 4 September, Virgin Atlantic completed the privately funded, solvent recapitalisation of the airline to ensure that we continue to provide essential connectivity and competition to customers in the UK and beyond,” the statement said. “We continue to explore financing opportunities to strengthen our balance sheet, as already provided for in the recapitalisation. This financing opportunity, regarding two of our 787s, allows us to pay down debt and improve our cash position going into 2021.”
It continued: “Passenger and cargo flying continued throughout November, and following our Black Friday sale we have seen encouraging demand for travel at Christmas, Easter, and summer next year. We are confident that Virgin Atlantic will emerge from the Covid-19 crisis a sustainably profitable airline, with a healthy balance sheet.”
In January, Bain Capital signed a deal to create a joint venture with Griffin Global Asset Management seeking to develop a commercial aviation leasing and asset management platform, as well as build a diversified aircraft portfolio. Under the deal, Bain was to provide the capital to acquire and lease aviation assets globally.
