Continental Airlines, as part of United Continental Holdings, indicated in a new capital markets financing that its average new Boeing 787 delivery is in the $127-128 million range - a figure that Boeing Capital agrees with.
In its $892 million series 2012-1 notes offering, Continental asked three independent appraisers Aircraft Information Services (AISI), BK Associates and Morten Beyer & Agnew to provide new base value opinions on four 787s scheduled for delivery between September and November this year.
AISI said a September 2012 delivery was valued at $120.8 million, while a November aircraft carried a $121.2 million new base value valuation.
BK was the highest of the three appraisers with quotes above the $130 million mark. The firm valued a September delivery at $133.5 million while a November aircraft carried a $134 million valuation.
MBA said the September delivery had a $127.9 million valuation, while a November built aircraft had a $128.3 million valuation.
In an interview with Flightglobal's Finance, Boeing Capital's capital markets managing director Kostya Zolotusky said the average quotation in the Continental's prospectus was on target. "$127 million for a new 787 delivery feels about right," he says.
Zolotusky said it is "gratifying that the 787 gets financed in such an efficient way".
"Continental is an important customer and it is great to see that the market is so receptive. The fact that Continental achieved the lowest coupon pricing on an EETC with 787-8 and 737-900ER aircraft as collateral is a testimony of the quality of those products," he said.
In Continental's $892 million Pass Through Certificates, Series 2012-1 offering, the $753 million A tranche has a 55.5% initial loan to value. The $139.1 million B tranche has a 65.5% initial loan to value.
The Class A notes have a 4.15% coupon while the Class B notes carry a 6.25% coupon. This is the lowest ever coupon achieved in an EETC financing for both tranches. The class A tranche matures in April 2024, and the B tranche in April 2020.
Credit Suisse's New York Branch will provide the initial liquidity facility for the Class A and B certificates. Natixis is the depositary agent.
Credit Suisse and Morgan Stanley are joint structuring agents and lead bookrunners in transaction. Deutsche Bank Securities and Goldman Sachs are the bookrunners, while Citigroup, Jefferies and JP Morgan are the co-managers.