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Wed 22 Jun 2011 12:22 PM

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Dubai Aerospace said to seek extension on $800m loan

State-owned leasing firm cancelled orders for Airbus and Boeing planes in March

Dubai Aerospace said to seek extension on $800m loan

Dubai Aerospace Enterprise Ltd, which canceled orders for Airbus and Boeing Co planes, is seeking an extension on an $800m loan that matures next month, a person familiar with the matter said.

The government-owned aviation services and leasing company is asking five banks to extend the loan due July 23 by three to four years, the person said, declining to be identified because the matter is private.

The lenders are in turn asking DAE to make a down payment on the loan, the person said. Citigroup Inc, Deutsche Bank, Emirates NBD, Lloyds Banking Group and Noor Islamic Bank arranged the loan in January 2009. A spokesperson for DAE couldn’t be reached for comment.

DAE, which has 47 aircraft on its books, entered the leasing market during the peak of an air-travel boom, and has since been hit by a slump in demand.

The company, set up in 2006 with the aim of becoming one of the world’s biggest airplane lessors, dropped orders in March for 42 planes from Airbus and in February canceled an order for 32 Boeing aircraft.

Separately, Robert Genise, chief executive officer of DAE Capital, the aircraft leasing unit of DAE, will leave the company on June 24 because his contract has expired, the person said.

Chief Financial Officer Heinz Westen, executive vice president of operations Art Schmidt, executive vice president of marketing and sales Michael Barry and two other senior marketing employees will also leave the company, the person said.

DAE has yet to announce a replacement for the positions, the person said.

DAE said in May full-year net income excluding non- recurring items rose sevenfold to $39m in 2010. DAE Capital’s revenue increased to $1.6bn, it said.

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