Ethiopian Review

(Nazret) — There were several media reports that reported that financiers of Ethiopian Airlines’ plan to purchase of 10 Boeing 787 have “pulled out”. According to information nazret received from one of the banks involved, DVB Bank in Germany and Ethiopian Airlines source, the story is misleading as it suggests that the banks have simply pulled out unilaterally. A DVB Bank source told nazret.com in email that, “the financing (of 787 pre-delivery payments) for Ethiopian had reached its scheduled expiry date. DVB made a new bi-lateral offer of finance to renew / extend the term of the facility to Ethiopian. The terms and conditions of such offer reflected the current market conditions for bank finance. These terms were considered by Ethiopian not to be attractive to them, and consequently the airline decided not to accept / pursue DVB’s new offer. This process was not controversial, but rather amicable.” And the source added, the expression “pull out” (of the financing), which is used in the article heading and elsewhere, is clearly not correct.

The message from DVM was confirmed by a source within Ethiopian airlines. The report which was first reported by Addis Ababa based Reporter newspaper was misleading as it suggested that the banks pulled out of financing when in fact it was Ethiopian airlines that did not find the terms to be attractive and chose not to renew it after its scheduled expiry date.

In February 2005, Ethiopian airlines has put an order for 10 Boeing 787 airplanes valued at 1.3 billion USD at list prices. The first plane was scheduled for delivery to Addis Ababa in 2008, but Boeing had repeatedly postponed the deliveries, which is now expected to be delivered by July 2010.