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Vietjet signs $614mn aircraft financing agreement

Released at: 17:00, 10/10/2018

Vietjet signs $614mn aircraft financing agreement

Photo: Vietjet

Finance to fund Vietjet's purchase of five Airbus aircraft, while carrier also announces new Japan routes.

by Ngoc Lan

New-age carrier Vietjet Air signed an aircraft financing agreement with Mitsubishi UFJ Lease & Finance Company Limited (MUL), a member of leading Japanese finance group the Mitsubishi UFJ Financial Group (MUFG), and banking group BNP Paribas from France on October 10 in the presence of Prime Minister Nguyen Xuan Phuc, to finance Vietjet’s acquisition of up to five new Airbus aircraft worth $614 million.

It also signed a memorandum of understanding (MoU) with French banking group Natixis and Japanese equity underwriters valued at $625 million, to facilitate financing for the five additional aircraft.

Vietjet and its financing partners will also work together to share best practices for the operation and management of the airline, boosting effectiveness and encouraging sustainable growth.

The acquisition of the aircraft is part of a new contract signed earlier between Vietjet and Airbus, and includes A321neo aircraft, which incorporates the latest in engine design, advanced aerodynamics, and cabin innovations.

A321neo engines offer a significant reduction in fuel consumption, of at least 16 per cent from Day One and 20 per cent by 2020 as well a 75 per cent reduction in noise and 50 per cent in emissions.

All aircraft financed will be delivered to Vietjet by the end of this year or early 2019.

Mr. Dinh Viet Phuong, Vice President of Vietjet Air, said the critical financing agreements signed once again confirms the confidence of leading Japanese financiers in Vietjet as the airline prepares to launch new routes to Japan shortly. “These deals will greatly contribute to Vietjet’s plans for fleet expansion and network growth in the coming time, thus helping to better connect Japan and Vietnam,” he said. “We are proud to have leading and renowned financing partners accompany us on the airline’s growth path. Together we are all fully committed to bringing more added values to the community.”

As part of Prime Minister Phuc’s official visit to Japan, Vietjet held a special ceremony to announce the airline’s three new routes linking Vietnam with Japan in the next three months, contributing to the growth of tourism and trade between the two countries and across the region.

                                 

                              Prime Minister Nguyen Xuan Phuc at Vietjet’s new route announcement ceremony (Photo: Vietjet)

The new Hanoi-Osaka route will commence operations on November 8, the Ho Chi Minh City-Osaka route on December 14, and the Hanoi-Tokyo route on January 11, all with daily return flights. Passengers can now book on vietjetair.com.

Prime Minister Phuc told ceremony that the launch of the new routes to and from the Kansai region of Japan has great significance in helping to rebuild Kansai’s economy and tourism after a devastating storm in early September and will contribute to tourism, trade and integration between the two countries and the region.

Mr. Hiroshi Tabata, Commissioner of the Japan Tourism Agency, said the new flights to Kansai International Airport will be a huge boost for tourism in the area and contribute to the recovery of the local economy. “I believe these new routes will also contribute to an increase in the number of Vietnamese visitors coming to Japan,” he added. “Vietjet’s flights to Japan will bring new travel experiences and choices to passengers from Vietnam and Japan, contributing to the development of comprehensive economic and cultural ties between the two countries.”

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