AAR, partner complete aircraft sale

KUALA LUMPUR: AAR Corp, a supplier of avionics products, and its joint-venture partner have completed the sale of 10 Boeing 737-400 aircraft to Malaysian Airline System Bhd (MAS), which the latter announced in November last year.

According to AAR, the aircraft have been on lease to MAS since they were acquired by AAR's joint venture in July 2007.

In a statement, AAR said the sale is consistent with the company's goal to reduce its investment in aircraft leasing.

AAR's portfolio now includes four aircraft held in joint ventures and two aircraft that are wholly-owned. At its peak, the company held a total of 42 aircraft in its joint venture and wholly-owned portfolios.

"The transaction closed during the third quarter will generate net cash proceeds of about US$20 million (RM61.8 million) and a modest recorded gain during the company's current fiscal year 2013. Due to joint-venture accounting, there will be no impact on reporter sales," it said.

According to the statement, the company remains active in the aircraft sales, re-marketing and modification business, where AAR has an established market presence and augments the sale of aircraft with high-value parts, maintenance and modification services.

In November last year, MAS said it had entered into an aircraft sale agreement with the seller, Bank of Utah, for buyback acquisition of the 10 used B737-400 aircraft.