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Rasha Al-Roumi takes Kuwait Airways chair Bonds, sukuk for Airbus buy

KUWAIT CITY, Dec 3, (Agencies): Rasha al- Roumi was on Tuesday appointed the new chairman for Kuwait Airways by Kuwait’s tranport and communications minister Esa al-Kandari, the state news agency said, after the previous chairman had been suspended. Sami al-Nisf was relieved of his duties after he had announced plans to buy five used aircraft from India’s Jet Airways, which the company has since abandoned. Jet Airways had also said no deal had been reached. Kuwait Airways may issue bonds or sukuk to finance a deal with Airbus to buy 25 new aircraft and lease 12 other new planes, the biggest overhaul of its fleet since the 1990 Iraqi invasion, an adviser to the airline said on Tuesday. It did not disclose the value of the agreement with Airbus or say how much money it intended to raise.

Asked how it would finance the deal, Amani Bourseli, an adviser to Kuwait Airways, told reporters: “Part of this will be from the firm’s capital and another will be financed through loans. “Certainly, bonds or sukuk will be issued depending on the decision by the board of directors,” Bourseli added. She said the size of the deal required a consortium of banks to be involved, including a lead bank. Bourseli said Kuwait Airways would receive the purchased planes from 2019 until the end of 2022, while delivery of the leased aircraft would be from the end of 2014 to around early 2015. In the meantime, KAC will lease 12 planes, seven A320 and five A330-200, from the European manufacturer. The final contract for the deal, the first plane order by KAC in more than 20 years, will be signed after a month, she said. In addition to modernising its fleet, the loss-making KAC wants to make the airline profitable before offering a local or foreign investor a 40 percent stake. Kuwait Airways has posted losses in all but one of the past 21 years, amounting to a total of more than $2.7 billion, which has been covered by the government.

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