unaligned

Hainan Airlines' board has approved a proposal to take a CNY4b ($567m) loan from a syndicate of eight Chinese state-owned banks. The loan will have a three-year tenure and two-year grace period. Its interest rate is fixed at 4.75% per annum. Funds raised will be used to finance the operations of carriers within the HNA Group, says Hainan Airlines in its Shanghai Stock Exchange disclosure. China Development Bank is acting as the deal's lead and correspondent bank. China Exim Bank, Bank of China, Agricultural Bank of China, ICBC, China Construction Bank, Postal Savings Bank of China, and Bank of Communications are members of the syndicate. The eight banks have agreed to contribute CNY500m each. HNA Group is serving as guarantor. Hainan Airlines says the loan is meant to "promote a stable development" of its operations and minimise risks while it builds its aviation focus and improves operating performance. The airline adds that the loan will be used in various ways: to pay for aviation fuel, for example, and for operating expenses such as salaries, as well as leases, both at Hainan Airlines and at affiliated carriers. It is unclear if any of the funds will go to troubled sister carrier Hong Kong Airlines, which is faced with imminent closure if it does not raise enough cash to continue operations.<br/>

Hong Kong Airlines on Wednesday said it had drawn up an “initial cash injection plan” that would allow them to pay remaining staff on Thursday as soon as the funds arrived, according to an internal memo from company chairman Hou Wei. Hong Kong’s third largest airline was given five days, since Monday, to find substantial – and unspecified – amounts of new capital to keep the business afloat, as its cash in hand fell below what was considered in keeping with its licence to fly, the Air Transport Licencing Authority. The body earlier delivered an ultimatum to the airline that a failure to find new cash or investors before Saturday could lead to the suspension, or even termination, of its licence. HNA Group, the controlling shareholder of Hong Kong Airlines, declined to comment on whether a HK$4.4 billion loan it obtained from a range of Chinese state-owned banks on Monday would go to the stricken carrier.<br/>

Virgin Atlantic's order for 12 Airbus A350-1000s has played a central part in the World Trade Organization's latest assessment as to whether subsidies influenced the competitive field against Boeing in the commercial aircraft market. The UK carrier placed an order for eight A350-1000s in July 2016, with plans to lease a further four. In its evidence to the WTO over the transatlantic subsidies dispute the US side claimed that the Virgin Atlantic order was one of several "significant lost sales" in the twin-aisle market – along with A350 deals from Emirates, Turkish Airlines, China Southern Airlines and others – which could be attributed to subsidies awarded to Airbus. While it acknowledges the difficulty in determining which of these orders Boeing might have won, the WTO says – in a ruling on 2 December – that it took "specific note" of the Virgin Atlantic sales campaign. Three aspects of the order, says the WTO, were "particularly instructive" to its assessment. The WTO had previously concluded that Airbus, under a different subsidies scenario post-2013, could not have offered Virgin the A350 for delivery until at least 2022. But Virgin secured earlier delivery slots, and received its first A350-1000 in August this year. Five aircraft were due for delivery in 2019. "All 12 delivery positions to which Virgin Atlantic agreed would have been unavailable in the [alternative scenario]," states the WTO ruling. "We have difficulty believing that such a consideration would not have weighed on the decision of Virgin Atlantic in this sales campaign."<br/>

Virgin Atlantic chairman Richard Branson has scrapped plans to sell 31% of the airline to Air France-KLM as originally agreed as part of the transatlantic joint venture among the two companies and Delta. Branson holds 51% of the UK-based long-haul specialist, with Delta holding the remaining 49%. Under the JV, Branson was to sell a 31% stake to Air France-KLM. The transatlantic JV was approved by the US Department of Transportation Nov. 22. “Importantly following this news, we have agreed (subject to contract) with our new joint venture partners, that our family will continue to hold the 51% of Virgin Atlantic shares we own,” Branson said. Branson, who founded the airline 35 years ago, said he had “always viewed Virgin Atlantic as one of my children” and was reluctant to part with it.<br/>

Vietnamese startup Bamboo Airways said Tuesday it will take delivery of a Boeing 787-9 Dreamliner this month, its first wide-body aircraft, and aims to start direct flights to the United States by early 2021. The plane will be the first that Bamboo owns, Vice Chairman Dang Tat Thang said, adding that the airline currently operates 20 leased Airbus aircraft. “The new wide-body aircraft will enable us to launch our direct flights to the United States, in late 2020 or early 2021,” Thang told a press conference. The Dreamliner is due to be delivered on Dec. 22, he said. The airline, owned by property and leisure company FLC Group FLC.HM, began flying in January. It aims to expand its fleet to 30 by the end of the first quarter of 2020, Thang said, a mix of Airbus (AIR.PA) and Boeing planes including four Dreamliners under deals previously announced. Bamboo now flies to major cities in Vietnam and destinations in Taiwan and South Korea, and Thang said it will add more international destinations next year, including Australia, Czech Republic and Germany. Bamboo, which earlier this year signed deals to buy 30 Boeing 787 Dreamliners worth $5.6, aims to expand its fleet to between 40 and 50 including leased planes by the end of 2020 and 100 by 2025, said Truong Phuong Thanh, deputy CE.<br/>

Fastjet needs to restructure by February 2020, if it is to continue as a going concern, with the disposal of fastjet Zimbabwe forming part of its survival plan. “The group will have sufficient resources to meet its operational needs until February 2020,” fastjet CFO Kris Jaganah said. “However, the headroom of available cash resources is minimal, and the projections are very sensitive to any assumptions not being met. If the group is unable to carry out the restructuring proposal by the end of February 2020, it would be unable to continue trading as a going concern.” The company is now in active equity and restructuring discussions with its major shareholders, which have responded positively to the proposals. Fastjet originally launched with a Tanzanian airline in November 2012. The group previously had airlines in several African countries, but this presence has since been slimmed down to Zimbabwe (fastjet Zimbabwe) and South Africa (FedAir). The most recent airline to suspend operations, on Oct. 26, was fastjet Mozambique. Story has more.<br/>