Aer Lingus signs deal to purchase twelve aircraft from Airbus

Aer Lingus yesterday signed a deal with Airbus to purchase 12 new long-haul aircraft, with an option for an additional six planes.

The airline said the list price of the 12 aircraft was $2.33 billion (€1.6 billion), but it had obtained "certain price concessions" from Airbus that would reduce the cost.

Analysts said the company would have received a discount of 20-30 per cent, suggesting a price to the airline of $1.6 - $1.8 billion for the new aircraft.

Aer Lingus said it might use bank debt, operating leases, finance leases and its own cash resources to fund the fleet expansion.

It raised €400 million at the time of its flotation last year for aircraft purchases.

Aer Lingus expects to hold an extraordinary general meeting (egm) of shareholders to approve the purchase in mid-December.

The deal, which was first announced on June 6th, will see Airbus deliver six A330-300s between 2009 and 2011, while six A350-900 XWB wide-body planes have delivery dates between 2014 and 2016.

Some of the new aircraft will replace current stock and Aer Lingus has said it will ultimately operate a long-haul fleet of 14.

Ryanair chief executive Michael O'Leary declined to say whether his airline would support the purchase of the aircraft.

"We will consider any motions that come before the egm, and will consider them on their merits," he told The Irish Times.

Ryanair is the biggest shareholder in Aer Lingus, with a 29.44 per cent stake.

This would not be sufficient to block the purchase, and would require the support of other shareholders, which seems unlikely.

Aer Lingus's shares closed down 3 cent or 1.4 per cent in Dublin yesterday at €2.20.