NAC highly probable to finalize Rs24 billion loan deal
May 2, 2017
Nepal Airlines Corporation (NAC) will be conducting a meeting between the board members today to finalize Rs24 billion loan to acquire two wide-body Airbus A330 jets. The corporation has planned to receive loan of Rs12 billion each from Employees Provident Fund (EPF) and Citizen Investment Trust (CIT).
The loan is expected to be received by NAC in two installments. The two A330 jets, expected to arrive in Nepal by January and March 2018, have been offered price of $104.8 million each by the American Aviation Support Company AAR Corp. NAC will be receiving Rs4 billion each from CIT and EPF for the first installment to be paid for AAR Corp.
NAC has agreed to pay interest on the loan at the rate of 9 percent annually however; the final agreement between the both sides is yet to be done. The government is the guarantor of the loan.
NAC total debt will increase to Rs34 billion as the corporation already took loan of Rs10 billion in 2015 to buy two Airbus A320-200 from EPF.
The sales and purchase agreement for two wide-body Airbus A330-200 was signed by NAC and AAR Corp on April 7, 2017 which became the historic day in Nepali aviation industry.
The current owner of the two wide-body jet aircraft, which NAC is acquiring soon, is an airline based in Lisbon, Portugal named HI Fly.
NAC has announced to increase flight frequencies to major destinations like Kuala Lumpur, Hong Kong and Doha. Also it will be launching four new long-haul routes namely Seoul (South Korea), Tokyo (Japan), Dammam (Saudi Arabia) and Sydney (Australia).