• Joe Breitfeller

Air Canada Completes Sale and Leaseback Transactions for Nine Boeing 737 MAX 8 Aircraft

The airline raised USD $365 million through a sale and leaseback transaction for three Boeing 737 MAX 8s with Jackson Square Aviation and a similar transaction with Avolon Aerospace Leasing Limited involving six additional MAX 8s.


Air Canada Boeing 737 MAX 8 - Courtesy Air Canada

On Thursday (October 8, 2020), Air Canada announced the completion of two sale and leaseback transactions for nine Boeing 787 MAX 8 airplanes. The carrier closed a transaction for three aircraft with Jackson Square Aviation and an additional six with Avolon Aerospace Leasing Limited, raising a total of USD $365 million (CAD $485 million). In the leaseback transaction the carrier has committed to long-term leases valued at USD $345 million (CAD $458 million). The nine Boeing 737 MAX 8s involved in the deal were delivered to Air Canada over the last three years and remain temporarily grounded until the FAA and Transport Canada lift the grounding order. In Thursday’s announcement, Air Canada’s Deputy Chief Executive Officer and Chief Financial Officer, Michael Rousseau, said,


"Since the start of the COVID-19 crisis, Air Canada has accessed financial markets numerous times and has successfully raised almost $6.0 billion in liquidity, on reasonable terms and conditions, including with this transaction, as it continues to maintain liquidity levels to mitigate the challenges and uncertainty ahead. We are very pleased to be extending our strong relationship with Avolon and beginning a new relationship with Jackson Square Aviation.”


Air Canada will use the net proceeds from the sale-leaseback transactions as a working capital supplement and for general corporate purposes. Since the start of the global COVID-19 pandemic, Air Canada has raised nearly $6 billion in liquidity. The carrier further fortified their balance sheet recently by refinancing $1.4 billion in short-term debt coming due in the next nine months. Air Canada will update their total unencumbered asset pool in their third quarter financial report.


Source: Air Canada