Barclays May Fund The Air India Fleet Expansion Plan

Indian flag carrier Air India has stated today that it is raising funds to buy 23 new aircrafts and is discussing the funding options with a consortium of UK-based Barclays and promotional bank for German and European countries KFW, and also with Deutsche Bank.
The proposed deal is expected to be finalized soon. This loan will have a sovereign guarantee and is thus expected to help the airline access finer rates. Usually, the dollar denominated loans to companies are currently pegged at the London-Interbank offered rate (Libor) plus 1,000 basis points (10%).
With a government guarantee, the rate could drop to Libor plus 450 or 500 basis points. Indian national carrier Air India is buying 23 Airbus A319s/320s, for which orders have already been placed with the European aircraft manufacturer.
20/11/08 The Sikh Times, UK

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Categories: Foreign Nov 2008, NACIL Nov 2008