Ethiopian Acquisition of Ten Boeing B787s Principally Financed by J.P. Morgan
Ethiopian Airlines, the fastest growing airline in Africa, has secured $1 billion of financing from J.P. Morgan for its 10 Boeing B787-8- Dreamliners. The Export-Import Bank (Ex-Im Bank) of the United States has provided export credit agency support via guaranteed loans that cover 85% of the total cost of the aircraft. The balance will be financed by a group of financial institutions including ING Capital, the Emerging Africa Infrastructure Fund (EAIF), The Netherlands Development Finance Company (FMO), the ICF Debt Pool LLP (ICF), and from internal cash resources of Ethiopian.
Ethiopian received its first Dreamliner on August 14, 2012 in Seattle, Washington. A series of events are planned to celebrate this milestone in the presence of Ethiopian and U.S. Government officials, Ambassadors and representatives of international organizations as well as Boeing and other partners? executives. The airline will take delivery of five Dreamliners before the end of the fiscal year.
“The financial support for our acquisition of the 10 B787-8 aircraft is critical to Ethiopian Airlines as we aim to become the leading African airline. Our first B787-8 aircraft will first be deployed, on rotation basis, in our African destinations. Thereafter, once we receive our second Dreamliner by mid-September, it will operate on our Washington D.C. route?, said Tewolde Gebremariam, CEO of Ethiopian. He added: ?Ethiopian is the first airline outside Japan to own this game changing aircraft. We are proud to continue our pioneering role in African aviation and to provide the best possible travel experience to our customers.”
“With uncertainty in the aircraft financing market about a potential funding gap and tightening credit conditions, J. P. Morgan?s $1 billion aircraft financing is testimony to our trusted relationship with Ethiopian Airlines and the strength and capacity of our trade finance capabilities,” said Jeremy Shaw, head of J.P. Morgan?s trade finance business in Europe, the Middle East and Africa (EMEA). “J.P. Morgan is committed to continued expansion in the SubSaharan Africa region where our clients are seeking cost effective, large scale funding to facilitate their strategic growth plans.”
This fiscal year alone, Ethiopian will phase-in 14 additional aircraft, including 5 Dreamliners, 3 brand new B737-800 with Sky Interior, and 5 exclusively business class configurated Q-400s. Ethiopian, which has registered an average yearly growth rate of 30% for the last 8 years, plans to become the leading aviation group in Africa by 2025.
To cater for this fast growth, the airline is undertaking numerous facility expansions, which include the construction of the biggest perishable cargo terminal in the world, a new state-ofthe art maintenance hangar and the biggest aviation training academy in Africa.