Allegiant Travel Company has announced that it has secured financing commitments for seven Airbus A320 and four Boeing 737 MAX aircraft from BNP Paribas, Europe's leading bank, along with aircraft lessor Jackson Square Aviation (JSA) today.
The innovative $412M deal combines banking and lessor capital to secure Allegiant's aircraft financing needs into the second quarter 2024, while providing the airline with healthy liquidity at an attractive cost in today's market.
Robert Neal, Allegiant's senior vice president and chief financial officer said ,
"We are delighted with BNP Paribas and Jackson Square's creativity in providing what we believe is an efficient framework that affords us robust liquidity to support foundational investments in our fleet. This transaction taps into young A320 CEO aircraft and will also serve as the inaugural financing for our Boeing 737 MAX equipment."
Allegiant has drawn down $196 million on September 29, and the remainder will be drawn commensurate with its initial 737 MAX deliveries.
"Our relationship with BNP Paribas, spanning more than a decade, has been instrumental in our growth as an ultra-low-cost leader. We are thrilled to welcome Jackson Square Aviation as a new partner as we make air travel more affordable and accessible to leisure travelers," added Neal.
Ankush Chowdhury, managing director & head of transportation banking and capital markets at BNP Paribas said,
"We are delighted to provide Allegiant, a long-standing client of the bank, an innovative and first-of-its-kind financing solution which combines bank and lessor capital into one transaction. This transaction allows the airline to maximize value while having more structural flexibility to manage its aircraft fleet versus the more traditional aircraft financing alternatives,"
"BNP Paribas is honored to partner with Jackson Square Aviation as we continue to innovate in the world of aviation finance with the goal of providing efficient and thoughtful financing solutions to our aviation clients," added Chowdhury.
Chris Dailey, president & chief commercial officer of JSA said ,
"It's a great pleasure to have Allegiant as a new airline customer for Jackson Square Aviation and we're pleased to be working together with a long-standing banking partner, BNP Paribas," "Combining the strengths of JSA and BNP Paribas, we're able to provide an efficient financing solution for Allegiant's fleet of in-service Airbus A320s and next generation Boeing 737-8-200s, which we're also excited to introduce as a first into our portfolio," said Dailey.
Looking at it fleet , Allegiant currently operates an all-Airbus fleet comprised of 127 Airbus A319s and A320s.
Allegiant has agreed to purchase up to 130 Boeing 737-7 and 737-8-200 models in a multi-year deal, Boeing's first with an ultra-low-cost carrier in the United States. The new 737 MAX additions will afford the airline flexibility, environmental benefits, and new customer features.
In another development, Allegiant Travel Company has also announced that John Redmond has resigned as chief executive officer and as a member of the Board of Directors effective immediately. Maurice J. Gallagher, former CEO, current executive chairman and one of the Company’s largest stockholders, will resume the CEO role.
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