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Air Canada Prepays $589 Million in Loans Related to Aircraft Financing

Air Canada has announced the prepayment of approximately $462 million loans from the Export Development Corporation (EDC), previously used to help fund the acquisition of 14 Airbus A220-300s, as well as around $127 million to the Export-Import Bank of the U.S.

Air Canada Airbus A220-300 - Courtesy Air Canada

On Thursday (September 7, 2023), Air Canada announced that they have prepaid loans of around $462 million from the Export Development Corporation (EDC) which was previously used to help fund the acquisition of 14 Airbus A220-300 aircraft. The prepayment was made on August 23, 2023, and is subject to accrued interest and breakup costs. Additionally, Air Canada has prepaid financings of approximately $127 million supported by the Export-Import Bank of the United States (ExIm), which was previously used to help finance the purchase of four Boeing 787-8 Dreamliners. As a result of these payments, these aircraft will be added to the company’s unencumbered asset pool, bringing the total to approximately $6.3 billion, excluding Aeroplan.

In Thursday’s announcement, Air Canada’s EVP and Chief Financial Officer, John Di Bert, said,

“One of Air Canada’s top priorities following the pandemic is to deleverage and since late last year we have now pre-paid approximately $1.87 billion in debt. This strengthens our balance sheet and provides us more flexibility to make strategic investments, including to improve the customer experience, and to continue upgrading our fleet such as through our previously announced acquisition of Canadian-made Airbus A220 aircraft. With our very solid liquidity position and cash flow we will continue to look for more opportunities to reduce debt further. We were pleased to partner with EDC in supporting the Canadian aerospace industry and we thank ExIm for facilitating our acquisition of Boeing aircraft.”

Air Canada is Canada’s largest domestic and international airline. The Canadian flag carrier is a founding member of the Star Alliance and the only international network carrier in North America to receive a Four-Star ranking from Skytrax. Air Canada provides scheduled passenger service to 180 airports in Canada, the United States, and internationally on six continents. Through the carrier’s Aeroplan loyalty program, customers can earn and redeem points on the world’s largest airline partner network of 45 airlines. Air Canada Cargo offers air freight lift and connectivity to hundreds of destinations across six continents with a dedicated fleet of 767-300 Freighters and passenger aircraft belly hold capacity. Additionally, the airline has committed to a net zero emissions goal from all global operations by 2050.

Source: Air Canada/CNW


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