Finnair releases cash with Airbus A350 sale-leaseback deal

(Reuters) – Finnair has finalised a sale and leaseback arrangement for one of its new Airbus A350 planes as the airline grapples with the pandemic’s impact on travel.

“The immediate positive cash effect for Finnair is in excess of 100 million euros ($118 million),” the company said.

Airlines across the world have been scrambling to improve their cash position and slash costs after lockdowns to contain the coronavirus brought global air travel almost to a halt.

Finnair said it sold the Airbus A350 aircraft delivered in February 2020 to Nomura Babcock & Brown and leased it back for its own operation, initially for 12 years.

The deal has no major impact on Finnair’s operating result for the third quarter of 2020, it said.

Finnair plunged to a second-quarter loss and said it would make a similar loss this quarter, despite operating more flights.

Finnair raised 501 million euros last month from an oversubscribed rights issue and has also received state and bank guarantees for a 600 million euro loan.

(Reporting by Tarmo Virki in Tallinn; editing by David Goodman and Jason Neely)