Norwegian Air is to buy 10 Boeing 737-800s which are currently a part of its leased fleet.
The transaction “at favourable terms” represents a key step in securing Norwegian’s future fleet.
The move, due to be completed in the current quarter of the year, will enhance financial flexibility in line with a long-term strategy and reduce overall ownership costs.
The Scandinavian carrier expects to record a non-recurring gain of about NOK 570 million, reflecting the pricing it has been able to achieve for the aircraft and the corresponding reduction of existing lease liabilities.
The deal is expected to generate recurring cost savings net of financing costs of an average of NOK 200 million per year, according to the airline.
It will initially be funded through the airline’s cash in hand. Norwegian said it was in the process of securing long term financing after completion through a combination of arrangements.
Chief executive Geir Karlsen said: “The overall terms achieved are attractive for Norwegian, and the transaction fits well with our long-term fleet and ownership strategy.
“The aircraft being acquired are an integral part of Norwegian’s existing fleet and will through this deal continue to operate across our attractive and growing route network.
“This move is expected to deliver both short and long-term cost savings, as well as provide additional flexibility for future fleet planning.”