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Century City aircraft lessor inks $5-billion deal at Paris Air Show

June 17, 2013|By W.J. Hennigan
  • Visitors watch as an Airbus A380 aircraft, operated by British Airways, participates in a flying display on the first day of the Paris Air Show.
Visitors watch as an Airbus A380 aircraft, operated by British Airways,… (Chris Ratcliffe / Bloomberg )

A Century City aircraft-leasing company has signed a contract with Airbus to purchase 50 single-aisle passenger jets in a deal worth about $5 billion at list price.

International Lease Finance Corp. announced the deal for the A320neo aircraft on Monday at the opening of the Paris Air Show.

PHOTOS: 50th International Paris Air Show

The air show, which ends Sunday, is one of the largest aerospace showcases and an event at which plane-makers, airlines and military officials from around the world gather to sign billion-dollar deals.

With its latest order, ILFC increases its total A320neo order to 150. The company said it will make its engine selection for the aircraft at a later date.

“The neo allows ILFC to offer its customers a single-aisle aircraft family that delivers a significant reduction in fuel consumption and the widest, most comfortable cabin in its class,” ILFC Chief Executive Henri Courpron said in a statement. “We have already seen significant market interest in the neo and that is why we have come back for more.”

ILFC buys aircraft and rents them to airlines for a fixed period. With plush headquarters at Constellation Place, formerly known as MGM Tower, the company has a fleet of more than 900 aircraft and business relationships with nearly every major airline in the world.

The company is in the midst of being sold by its parent, insurance giant American International Group Inc., to a consortium of Chinese investors -- although that deal is now at risk after a filing with the Securities and Exchange Commission.

According to the filing, AIG can now look for a new buyer or sell off shares of ILFC in a public offering.

Problems first crept up late last month when the investment group failed to meet the deadline that was specified under the terms of a deal to sell up to 90% of ILFC for $4.8 billion.

In addition, AIG agreed to extend the deadline to close the deal, to mid-July from mid-June.

Nonetheless, the Airbus announcement is good news for ILFC. In recent years, the company hasn’t placed as many orders for new aircraft at the key air shows -- Paris alternates with the Farnborough International Airshow in Britain each year -- as it had in the past.

But this year, ILFC also announced a letter of intent for the purchase of 50 E-Jets E2 aircraft from Brazilian plane-maker Embraer. The deal also includes options for an additional 50 aircraft.

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