OSLO (Reuters) - Norwegian Air (OL:NWC) has struck a deal with China's CCB Leasing to take joint ownership of a large fleet of aircraft that the budget carrier has ordered from Airbus (PA:AIR), Oslo-listed Norwegian said on Thursday.
The cash-strapped carrier has for months said it aimed to find a partner to help take ownership of the Airbus fleet, thus allowing Norwegian to boost its finances.
CCB Leasing Corporation DAC (CCBLI), a wholly owned subsidiary of China Construction Bank Corp (SS:601939), will own 70% of the joint venture, while Norwegian Air's Arctic Aviation unit will own the remaining 30%.
"Under the terms of the agreement, the joint venture will purchase from Arctic an initial 27 Airbus A320 NEO aircraft to be delivered from 2020 to 2023," Norwegian said.
"In addition to a positive equity effect, the joint venture will reduce Norwegian's committed capital expenditure by approximately $1.5 billion based on the initial 27 aircraft," the company said.
"This agreement will contribute significantly to reducing our current and future capital expenditure," acting Norwegian Air CEO Geir Karlsen said in a statement.