TransAsia Airways Corp (復興航空) is negotiating with Airbus Group SE over the possibility of recovering NT$1.2 billion (US$37.57 million) it has made in down payments for 10 new aircraft, the carrier said yesterday.
TransAsia made the statement in response to speculation by some aviation industry insiders that as the company has announced its dissolution, it will lose the down payments for the new aircraft, which they estimated at NT$5 billion.
TransAsia placed orders for six A321neo aircraft in 2010 and four A330-800neo aircraft in 2014. They were scheduled to be delivered starting in 2018. The two models are officially priced at more than US$70 million and US$250 million respectively.
Photo: Reuters
According to the insiders, in an aircraft purchase deal, the manufacturer usually gives a discount to the buyer, but requires a large down payment equal to about one-third of the purchase price, which is usually kept secret.
In TransAsia’s case, the A330-800neos could have been bought at a discounted price of about US$100 million each, while the A321neos might have been sold at a discount of more than 50 percent, they said.
Based on this estimate, the down payments for the 10 aircraft would amount to NT$5 billion, they said.
However, TransAsia said that it had made a down payment of only NT$1.2 billion and that it was negotiating with Airbus in the hopes of getting the money back.
TransAsia on Tuesday announced that it would dissolve due to heavy losses, with all flight services terminated, effective immediately.
The airline posted a net loss of NT$2.22 billion and a loss per share of NT$3.42 in the first nine months of this year, with a gross margin of minus-18.76 percent.
TransAsia has a fleet of 27 aircraft, including 16 leased airplanes and 11 that it owns.
While the leased aircraft are to go back to their leasing companies, the purchased airplanes are to be sold to repay debts.
TransAsia shares fell for the third consecutive session on Friday to close at NT$3.80 on the Taiwan Stock Exchange (TWSE).
Analysts said there is no sign of the plunge ending soon, with orders to sell 81.75 million TransAsia shares still on the books after the market closed on Friday.
The airline is scheduled to hold a special general meeting on Jan. 11 for shareholders to vote on the closure decision, which would set the stage for a delisting from the market, the TWSE said.
Should that happen, a delisting is likely at the end of March after the airline completes all the necessary administrative steps.
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