Kuwait's ALAFCO prepares for London listing

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Kuwaiti lessor ALAFCO is seeking regulatory approval to list a 30% shareholding on the London stock exchange.

The lessor is also to concentrate on sale and leaseback opportunities as it waits to start absorbing over 100 aircraft on order from 2017.

ALAFCO chief executive Ahmad Alzabin says London has been selected as the exchange of choice for the listing, which will be a secondary market measure traded as global depository notes.

Although the listing has been agreed in principle, he says, it requires the go-ahead from Kuwait’s Capital Markets Authority.

Middle Eastern carriers will probably be active at the Dubai air show but ALAFCO is not interested in ordering further aircraft – even though Alzabin says that orders are the “best investment” because “you can control the economics”.

“We’ll be quite busy [with current orders],” says Alzabin, speaking to Flightglobal during the Arab Air Carriers Organization conference in Doha. “But we’re in the market for sale and leaseback.

“Once you order aircraft [you’re] not going to remain stagnant. So sale and leaseback becomes your best option.”

ALAFCO primarily deals in single-aisle types. It has 85 Airbus A320neo and 20 Boeing 737 Max jets on order. But it also has a backlog of 12 Airbus A350s – half of which have been placed with Thai Airways – and eight Boeing 787s.

While it transferred 14 of its original 22 787 orders to other carriers – Saudia and Oman Air – Alzabin insists the lessor is “not steering away” from the Boeing twinjet.

“The 787 was an excellent investment,” he says, adding that the lessor has a “strong collaboration” with Boeing to place the remaining eight.

ALAFCO took the type on a “speculative basis”, says Alzabin. When Kuwait Airways axed its plans to take 787s from the lessor as part of a fleet renewal, he says, there was plenty of interest elsewhere.

“I’m not exaggerating when I say we had 19 queries on those [aircraft],” he says.

ALAFCO is not interested in the A380, however, because the type is “too big for our operations”, says Alzabin: “We prefer to have a more liquid aircraft, a wider base.”