Virgin sells two 787s for a surprisingly small sum, here’s why

In a bid to raise cash to help it through its COVID-19 recovery, the Crawley-based carrier has agreed to the sale of a pair of Dreamliners

Virgin Atlantic has signed a sale and leaseback agreement covering two Boeing 787-9 Dreamliners.

According to Sky News, the airline is to receive a “cash enhancement” of up to £70m by selling and leasing back the pair of nearly new widebodies.

Aviation Image Network/Simon Gregory
(Photo Aviation Image Network/Simon Gregory)

The deal is with Griffin Global Asset Management, an aircraft lessor backed by Bain Capital who coincidentally rescued Virgin Australia earlier this year.

The carrier is not the first to enter into this type of agreement. In October, easyJet sold nine Airbus A320 Family aircraft, generating total cash proceeds of more than £300m in the process.

The low-cost carrier agreed the sale of five A320s to Ireland’s Wilmington Trust SP Services for £146.5m, which will then be leased for an average term of 117 months. The second transaction was executed with Sky High 112 Leasing Company for the sale and leaseback of four A320 Family aircraft which are expected to be leased back for an average period of 116 months.

Of the 17 Dreamliners in Virgin Atlantic’s fleet, only four are listed as being owned by the carrier. These include G-VDIA (c/n 37975), G-VMAP (c/n 38047), G-VNYL (c/n 37981) and G-VOWS (c/n 37974).

The Boeing-built examples range from 2.7 to five years old and are all setup with 268 seats in a three-class configuration.

The reported £70m purchase price suggests that Virgin does not fully own both aircraft, but instead has loans covering the assets. The list price for a 787-9 is approximately £220m.