Story ID: 1GPbdierchina11112014
Bombardier, China’s SPDB Ink Financing Deal
By: Gregory Polek
Caption: MOU promises to open new financing and leasing options for Bombardier's Chinese customers
Word Count: 304
Bombardier has signed a memorandum of understanding (MOU) with China’s SPDB Financial Leasing Company outlining the terms of a deal under which SPDB would supply advance payment financing, delivery financing and leasing services for commercial and business aircraft. Signed on the first day of Airshow China in Zhuhai, the deal would make available up to $500 million in capital controlled by SPDB.

“SPDBFL and Bombardier are equally focused on offering tailored aircraft solutions to meet the needs of airlines and other customers,” said SPDBFL chief executive Xiang Yu. “While this memorandum will be beneficial to both parties, it also provides a framework to advance China’s finance and legal infrastructure to further improve aviation financing in the country.”

For Bombardier, the deal opens more opportunities for financing its airplanes in the People’s Republic.

“With China being one of Bombardier’s key growth markets, this MOU places us in a stronger competitive position to recommend financing and leasing solutions for potential customers in the country, and is another positive step in reinforcing our domestic presence,” said Bombardier Commercial Aircraft head of structured finance Marc Meloche. “We are very pleased with the sales momentum we have been gaining in China recently.”

On November 8 China Express Airlines revealed itself as the previously unidentified customer for 16 Bombardier CRJ900s. Announced on June 30, the deal includes options for another eight of the type and potentially carries a value of $1.12 billion. Bombardier president and CEO Pierre Beaudoin joined Chinese premier Li Keqiang, Canadian prime minister Stephen Harper and China Express chairman Hu Xiaojun during a November 8 ceremony in Beijing to celebrate the transaction.

Eight years after its establishment, China Express operates four 50-seat CRJ200s and eleven 84-seat CRJ900s to nearly 50 cities throughout China.