Allegiant enters new deal to buy Boeing jets
Allegiant Air has taken its first step toward adding new aircraft to modernize its fleet.
The discount air carrier, a division of Las Vegas-based Allegiant Travel Co., on Tuesday announced in a release and in a Securities and Exchange Commission filing that it has signed a $412.1 million credit financing package to refinance seven Airbus A320 jets and to acquire four new Boeing 737 MAX aircraft.
The financing deal with BNP Paribas and JSA International U.S. Holdings, LLC will enable the airline – the No. 7 domestic air carrier operating at Harry Reid International Airport – to get the first of 50 of the twin-engine Boeing jets with options to acquire up to a total of 80. The deal to buy the planes was first announced last year.
Boeing will deliver two aircraft per month beginning in December through October 2025.
The company reported it received $196 million of the package Thursday and will receive the rest from time to time as needed.
“We are delighted with BNP Paribas and Jackson Square’s creativity in providing what we believe is an efficient framework that affords us robust liquidity to support foundational investments in our fleet,” said Robert Neal, Allegiant’s senior vice president and chief financial officer in a release. “This transaction taps into young A320 CEO aircraft and will also serve as the inaugural financing for our Boeing 737 MAX equipment.”
Allegiant currently operates an all-Airbus fleet of 127 Airbus A319s and A320s. A spokeswoman said the airline plans to operate a mixed fleet with the addition of the Boeing aircraft.
Allegiant has agreed to purchase up to 130 Boeing 737-7 and 737-8-200 models in a multiyear deal, Boeing’s first with an ultra-low-cost carrier in the United States.
Allegiant once operated a small fleet of Boeing 757 jets on flights to and from Hawaii, but abandoned that route in 2017.
Allegiant also affirmed that Maurice Gallagher, who restructured the company out of bankruptcy in 2001 and became its chief executive, has returned as CEO, replacing John Redmond, who left the company.
According to an SEC filing, Gallagher will receive a base salary of $750,000 per year and a $750,000 bonus in February 2024.
Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on X.