July 12, 2017 / 12:45 PM / a month ago

Kuwaiti lessor ALAFCO seeks $300 million loan –sources

DUBAI, July 12 (Reuters) - Kuwait’s Aviation Lease and Finance Company (ALAFCO) has asked commercial banks to submit proposals for a $300 million loan, banking sources familiar with the matter said on Wednesday.

The three-year loan would be used to back aircraft purchases and for pre-payment on deliveries.

KFH Capital, the main investment arm of Kuwait Finance House, is advising the company on the fundraising, the bankers said.

ALAFCO declined to comment.

ALAFCO, a sharia-compliant aircraft leasing company listed on the Kuwait stock exchange, specialises in aircraft operating leases, lease management and in the sale and leaseback of aircraft.

It recently bought four B777-300ER planes for $1.36 billion from Kuwait Airways, which ALAFCO will lease to the carrier until 2029.

ALAFCO plans to have at least 100 aircraft in its portfolio by 2020, up from 50 aircraft at the end of 2015.

The company reported a 78 percent jump in net profit to 10.8 million Kuwaiti dinars ($35.75 million) for the six months to March 31.

The firm is 46 percent-owned by Kuwait Finance House, while Gulf Investment Corporation – an investment company equally owned by the governments of the six member states of the Gulf Cooperation Council – owns a 14 percent stake.

Kuwait Airways Corporation owns a 10 percent stake, and the remainder is held by private investors.

$1 = 0.3021 Kuwaiti dinars Additional reporting by Ahmed Hagagy; editing by Jason Neely

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