We noticed you're blocking ads.

Keep supporting great journalism by turning off your ad blocker.

Questions about why you are seeing this? Contact us

Font Size

- Aa +

Thu 4 Oct 2007 10:28 AM

Font Size

- Aa +

DAE takes off with $1.5bn in aircraft deals

Dubai-owned firm buys 30 aircraft as part of its plans to build 125-plane fleet in five years.

State-owned Dubai Aerospace Enterprise (DAE) will sign deals to acquire 30 aircrafts in four to six weeks as part of a plan to build a fleet of 125 planes within five years, the company's aircraft leasing business head said.

DAE Capital chief executive officer Bob Genise told Gulf News in an interview on Wednesday that purchases will be in the secondary market and involve up to four transactions.

"I hope to have them done in another four to six weeks - if all goes well, I would like to have (deals for) 30 aircraft completed," Genise said to Gulf News, also saying that discussions with investment banks and financial institutions about funding facilities were underway.

DAE, which last month dropped its $1.8 billion bid to take over New Zealand's Auckland International Airport, is in talks with Boeing and Airbus about buying as many as 125 aircraft for delivery from 2010.

Family-ruled Dubai is capitalising on its experience in developing state-owned Emirates into the world's seventh-largest international carrier in two decades, seeking to start an aircraft leasing business to tap passenger travel and freighter demand from Asia to the Americas.

"Our business plan calls for us to acquire a block of aircraft immediately to jumpstart the business and have about $1.5 billion on the books by year-end," Genise said.

DAE Capital, which Dubai set up last year, wants to spend about $1 billion each year to expand the business after that, and is also looking at an annual growth rate of 25%.

"I expect that we would be $5 billion in assets and have annual revenues in excess of $500 million a year at the end of 2011," Genise said.

The majority of the planned 125 would comprise of B737s, B777s, A320s, A319s and A330-200s.

The company is considering the Boeing 747-8 to be part of its freighter fleet. It will also look at some freighter modification opportunities, probably with the B757 and B767, Genise said.

The company's biggest customers are likely to be in Europe, followed by Asia-Pacific and the Middle East, Genise said. The Americas may account for between 10% and 15% of the aircraft it rents out.

Middle East carriers such as Emirates, Qatar Airways and Abu Dhabi-based Etihad Airways have driven global aircraft orders in the last few years.

Arab carriers have ordered $80 billion of planes during the last three years, of which $32 billion was announced at the Paris air show in June, according to the International Air Travel Association of 240 airlines.

Airport chief quits

DAE Airports chief executive officer Kjeld Binger, hired in January to help Dubai garner airport management work worldwide, quit four weeks after the Auckland bid was rejected, Bloomberg reported today.

Binger, who left Denmark's Copenhagen Airports to come to Dubai, confirmed he resigned and declined further comment in a text message yesterday.

DAE spokeswoman Zarmineh Rab said in a telephone interview the chief executive quit to "pursue other endeavours."

"Kjeld leaves the company on amicable terms and we wish him well," Rab said declining to name a successor.

Arabian Business digital magazine: read the latest edition online

For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.