Released under the GIC Framework
(RTTNews.com) - Cathay Pacific Airways Ltd. (CPCAY.PK, CPCAF.PK) Friday said it has entered into a purchase agreement with Airbus S.A.S., a unit of European Aeronautic Defence and Space Company, or EADS NV (EADSY.PK), to purchase six Airbus A350-900 aircraft for a basic price of around $1.628 billion.
The price comprises the airframe price, price of specification change notices, and engine price. Cathay Pacific said Airbus has granted it significant price concessions and the actual consideration is lower than the basic price.
Cathay Pacific has applied to the Hong Kong Stock Exchange for a waiver from strict compliance of rules in respect of disclosure of the actual consideration of the aircraft, as it may lead to a loss of the concessions and will have a negative impact on the company's cost for the transaction.
The purchase price is payable in cash in eight instalments. The first seven instalments are to be paid before delivery of each aircraft and the balance upon delivery of the aircraft. Cathay Pacific expects to take delivery of these aircraft from 2016 to 2017.
The transaction will be funded through commercial bank loans, other debt instruments of the airline and cash generated from the company's business operations.
The new aircraft will replenish and expand the airline's fleet capacity and will mostly serve long-haul destinations in Europe.
The stock is curretly trading at HK$14.62, up 1.53 percent, on 1.63 million shares.