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Company News

25 May 2006

Aeroflot And Leading French Banks Signed Credit Agreement

Aeroflot – Russian Airlines, JSC and leading French banks with focus on financing aircraft purchases, Natexis Transport Finance and Calyon, signed a credit agreement for financing of prepayments with regard to purchase of seven Airbus A321 crafts in the amount of US$50 million.

The agreement is part of the financial package, offered by banks Natexis Transport Finance and Calyon for financing of the purchase. Further financing will include 100%-financing of the aircrafts’ price under warranties from the EU Export Credit Agencies (COFACE, HERMES and ECGD) for the period of 10 to 12 years, in the amount of 85% of delivery cost of the aircrafts, and a commercial loan issued in two tranches, for 10 and 3 years, in the amount of 15% delivery cost.

The financial leasing transaction with participation of the Export Credit Agencies has been the second experience of Aeroflot (in 2003 – 2004, the company implemented the same financial leasing programme for buying eight А320 aircrafts). Provided warranties from the agencies, the air carrier can raise funds enjoying lucrative conditions (interest based on LIBOR flat for 10 to 12 years). Similar schemes for financing purchases of aircrafts is increasingly popular.

Aeroflot is planning to extend cooperation with the Export Credit Agencies and US-based Eximbank in the area of financial leasing for different aircraft types in the future.

As reported earlier, the Board of Directors approved the revised terms for interrelated transactions for purchasing of seven Airbus A321 aircrafts, including financing of pre-payments, on 29 March 2006, the first delivery to take place in the fourth quarter of 2006.

Founded in 1923 and based in the Sheremetyevo airport (Moscow, Russia), Aeroflot – Russian Airlines, JSC is Russia’s largest longhaul and domestic carrier, operating 39% of international, and 11% of domestic services. Aeroflot is member of Sky Team, a global alliance of air carriers, voted by readers of the Global Traveler Magazine “The Best Airline Alliance”. In 2005 the company carried 6.8 million passengers to 89 destinations in 47 countries. With 83 aircrafts in its fleet, Aeroflot operates 302 services daily. For more information about Aeroflot visit www.aeroflot.ru and www.skyteam.com.