Kuwait Airways has entered into a memorandum of understanding (MoU) with Airbus to purchase 25 jets with an option for further ten and to lease 12 aircraft.
The latest deal marks the carrier’s biggest fleet overhaul since the 1990 Iraqi invasion.
Speaking at a press conference, Kuwait Airways acting chairman Jassar al-Jassar said: "We have signed a memorandum of understanding with Airbus to purchase 25 planes to replace the existing ageing fleet."
However, the carrier did not disclose the value of the deal due to a confidentiality clause.
In May, the airline signed an initial deal with Airbus to buy 15 A320neo aircraft and ten new A350-900 XWBs, along with option for ten more aircraft, as part of its plans to remove 11 ageing jets from its fleet of 17 aircraft.
At the time, local media estimated the cost of the deal at $3bn.
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By GlobalDataUnder the latest deal, KAC will also lease 12 aircraft, including seven A320 and five A330-200s, from the aircraft manufacturer.
Kuwait Airways advisor Amani Buresli said that the final contract for the transaction, the first aircraft order by the carrier in more than two decades, will be signed after one month.
A part of the financing will be done through a syndicated loan from international and local banks, with other part funded by issuing bonds or Islamic Sukuk, Buresli said.
Besides modernising its aircraft fleet, the loss-making airline intends to become profitable before offering a local or foreign investor a 40% stake.
Image: A Kuwait Airways’ aircraft landing at Frankfurt Airport, Germany. Photo: courtesy of Milad A380.
