KARACHI, (Reuters) – Airblue, Pakistan’s biggest private airline, plans to spend up to $700 million over the next five years on new aircraft as it replaces its existing fleet of leased planes.
Chief Operating Officer Shahid Khaqan Abbasi also said Airblue, which competes with state-run Pakistan International Airlines on several domestic routes, was considering a stock market listing.
“We are discussing the option, and it will depend on market conditions as well as appetite. We may well choose to go for listing abroad, as it seems more viable,” he said.
Abbasi said the airline was in talks with both Airbus and Boeing for the purchase of up to 14 short-to-medium haul aircraft.
“We plan to buy somewhere between eight and 14 aircraft either from the Boeing 737 NG (New Generation) family or the A320 family of Airbus,” Abbasi told reporters on Thursday, noting a deal, which could be announced in time for the Dubai Air Show in October, could be worth $400-$700 million.
He said delivery would start in 2009 and Airblue would take one plane around every three months.
Another senior Airblue official, who asked not to be named, said the airline would most likely choose the Airbus A320. “We already operate these aircraft and have a comfort level with them. So it suits us to have more of the same family.”
Airblue currently operates six A320s and has another two on order.
“We want to go for a brand new fleet,” Abbasi said. “We plan to replace the existing fleet with the new planes, but if there is a market at that time, we may retain them as well.”
The International Finance Corp. (IFC), the World Bank’s private sector arm, has agreed to provide financing worth $25 million for pre-delivery payments, and Airblue plans to get an ECA (Export Credit Agency) credit to fund the purchase.
Airblue, which started operations in June 2004, also flies to Dubai and Manchester, and plans to expand its international routes.
“There is good potential on European routes, the UK as well as Scandinavia, as well as in the Middle East,” Abbasi said.