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Our Bureau

New Delhi , Aug 14

The low-cost airline SpiceJet has signed a sale and lease back agreement with Babcok & Brown Aircraft Management (BBAM) and Nomura Babcock & Brown Company Ltd for five new Boeing 737-900 Extended Range (ER) and 11 Boeing 737-800 aircraft.

The aircraft are valued at $1.1 billion based on the manufacturer's list price.

As per the agreement, BBAM will pay the aircraft manufacturer once the Boeing 737s are ready for delivery. And, the company will lease the aircraft to SpiceJet at a price agreed to in advance. The airline would pay lease rentals for 10 years after which the aircraft would be property of SpiceJet.

The sale and lease back route is a common practice followed by airlines globally as they do not have to fund their expansion plans.

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