Qatar Airways is celebrating another key achievement after picking up the Middle East Finance Deal Of The Year Award for the second time in three years at a lavish ceremony in New York. Qatar Airways was recognised for striking a unique financing deal for its Buyer Furnished Equipment with a group of three banks that was put in place last year.
The BFE comprises items such as galleys, seats and inflight entertainment equipment, which Qatar Airways buys directly from suppliers and delivers to Airbus for installation on its new aircraft in production. Previously, Qatar Airways made all BFE payments from the airline’s cash reserves.
The judging panel at the Annual New York Air Finance Conference was impressed with the way in which Qatar Airways struck the deal.
The awards ceremony took place at a gala night during the two-day conference, held at the Waldorf Astoria Hotel in America’s financial capital. Qatar Airways General Manager Finance Richard Forson received the award on behalf of the airline.
Organised by Air Finance Journal, a prestigious London-based magazine published by Euromoney Plc, the conference - now in its 26th year - brought together airlines, venture capitalists, banks, investment institutions and financial advisors.
The growth of Qatar Airways over the next few years, coupled with rising demand for the latest, state-of-the-art BFE, means that the airline is investing heavily in new equipment. The award-winning facility will finance over US$250million worth of BFE over a four-year period in the deal struck last year with BNP Paribas, Citigroup and Qatar National Bank.
The 2006 Air Finance Journal Airline Deal of the Year Awards demonstrate how lenders are now prepared to be more creative in their investment decisions.
Qatar Airways Chief Executive Officer Akbar Al Baker said: “Qatar Airways is once again honoured to receive the prestigious Middle East Finance Deal of the Year award for the second time in three years. This award recognises the diligent efforts of our team at Qatar Airways to negotiate creative financing deals with a broad range of financiers.
“The facility was established to finance the Buyer Furnished Equipment, comprising items such as galleys, seats and inflight entertainment bought directly from suppliers, for a fleet of 25 Airbus aircraft. I would like to thank the three banks involved in this deal, BNP Paribas, Citigroup and Qatar National Bank for their support. We are very pleased to have been working with such a strong group of banks.”
Added Al Baker: “The meteoric rise of Qatar Airways over the past few years and in the years to come, coupled with growing demand for the latest, state-of-the-art Buyer Furnished Equipment, means that we are well positioned as an airline making waves in the global aviation industry.”
Prime Aviation Ltd, of London Gatwick in the UK, advised Qatar Airways on the structuring of the BFE Financing Facility for 25 aircraft for delivery between August 2005 and February 2009.
The facility is structured to allow drawdowns to meet the contracted BFE payments required in the 24 months leading up to the delivery of each new aircraft, with the loan being repaid by the long term aircraft financing on delivery of each aircraft.
The facility is novel in that it allows a progressive drawdown by Qatar Airways of multiple amounts due to different BFE vendors on each aircraft.