Soaring to new heights

Thai Airways International PCL recently secured a loan facility for the EUR-equivalent of USD 497 million from ING in connection with its acquisition of three new Boeing 777-300ER aircraft.

The three Boeing 777-300ER aircraft (the 'aircraft') will be used by Thai Airways International PCL ('TG') on its long-haul route network and will replace older-generation aircraft in TG’s fleet that will gradually be phased out, such as Boeing 747-400 aircraft and Airbus A300-600 aircraft.


"We are especially appreciative of ING’s understanding, support and pro-active approach throughout the process"

In particular, the new state-of-the-art twin-engine aircraft are much more fuel-efficient than the aging Boeing 747-400 aircraft which have four engines, and thus will enable TG to not only reduce its operating costs, but reduce its carbon footprint, as well. The aircraft are equipped with two General Electric GE90-115B high-bypass turbofan engines which have lighter fan blades made from carbon fiber that reduce the weight of the engines and help lower fuel burn compared to older-generation engines.


Thai Airways is the national flag carrier of Thailand and is listed on the nation’s stock exchange, with a controlling stake owned by the Ministry of Finance of Thailand. It is the largest carrier in Thailand and the 13th largest carrier in Asia. With its fleet of 101 passenger and cargo aircraft, TG operates domestic and international passenger and cargo services to 79 destinations in 35 countries.


Over the next few years, TG will continue to take delivery of new aircraft, to replace older aircraft, which will allow the airline to further reduce the average age of its fleet, and provide its passengers with an improved level of comfort, as well as the latest technology in terms of entertainment systems and internet connectivity. Consequently, TG will be able to continue to offer the high quality service for which it is renowned. These new aircraft deliveries will also enable TG to expand its network by either opening new long-haul international routes or increasing frequencies on certain other routes, in order to maximise the efficiency of its network.


ING’s Structured Export Finance team in New York acted as the sole arranger and will also be the agent for the 12-year term of the loan facility, which was the very first aircraft financing transaction that ING has completed for TG. The loan facility is guaranteed by the Export-Import Bank of the United States, the official export credit agency of the US Government, whose role is to promote and create US jobs through exports by providing support to foreign buyers of US goods and services. The team in New York worked closely with the Structured Export Finance unit in Frankfurt for the funding of the transaction. ING Bank, a branch of ING-DiBa AG in Germany is the sole lender and funded the first two aircraft in August and will fund the third aircraft which is scheduled to deliver to TG in January 2015.


ING’s extensive track record and expertise in arranging and executing Ex-Im Bank- and European ECA-supported aircraft transactions denominated in foreign currencies, and euro in particular, combined with ING Bangkok’s on-the-ground support with its close relationship and contacts with TG and its deep knowledge of the local market, contributed to the smooth and efficient execution of this prestigious mandate from TG. 


ING, TG and the other parties to the transaction worked diligently as a cohesive team with a view to closing the documentation for the financing in less than a month, in order to enable TG to take delivery of its second Aircraft in a timely manner in late August.


“We are especially appreciative of ING’s understanding, support and pro-active approach throughout the process to ensure a successful closing, despite the challenging environment in Thailand”, says TG’s Funding Team department.


Image: Boeing Mediaroom