(Adds detail, background)
LONDON, Aug 3 (Reuters) - Germany-based holiday company TUI
said it agreed a sale and leaseback deal for five new
Boeing 737 MAX-8 aircraft with BOC Aviation, raising $226
million to help boost its finances.
COVID-19 has wiped out air travel for Europeans for months,
and now the threat of a resurgence in infections and new
restrictions are causing more pain for airlines.
TUI has said it needs to cut 8,000 jobs and shed 30% of its
costs to prepare for a smaller tourism market.
The company said on Monday that the sale and leaseback deal,
which applies to aircraft it will receive next year, was part of
its "asset right" approach to ownership and it expected further
sale and leaseback financing on its deliveries beyond 2021.
The agreement was on standard commercial terms, said TUI,
and would create a lifetime lease obligation of around 223
million euros to begin at the end of its 2021 financial year.
During what has become the travel sector's deepest crisis,
BOC Aviation has struck an estimated $5.5 billion in deals with
carriers including Southwest and United Airlines
to buy and lease back aircraft on what it says is more
favourable pricing than would have been available in a stronger
market.
The chief executive of BOC Aviation, which is based in
Singapore and listed in Hong Kong, has said he remains confident
in the 737 MAX plane which has been grounded for more than a
year pending regulatory approval following two crashes.
Last week, the crisis for TUI deepened when it said its UK
unit was forced to cancel thousands of holidays after Britain
advised against travel to Spain, bringing back a 14-day
quarantine rule for returning travellers just 15 days after
dropping the requirement.
(Reporting by Sarah Young; editing by Paul Sandle and Jason
Neely)