On July 22, 2003, Vietnam Airlines signed the first of three financing agreements with Citibank for the purchase of three Boeing 777-200ER aircraft as part of the carrier’s fleet expansion. Pillsbury Winthrop LLP acted as counsel to Citibank in a US Export-Import Bank-supported financing of the aircraft, the first of which was delivered on August 20, 2003. This transaction is the first significant financial guarantee by the United States since the two countries signed a bilateral trade agreement in 2001.
Ex-Im Bank agreed in October, 2002, to support the purchase of several Boeing 777-200ER aircraft to be delivered between 2003 and 2005. Citibank won the bid to finance three of the aircraft that Vietnam Airlines will purchase.
Under the first loan agreement, which enabled the purchase of the first aircraft, Citibank provided the airline with a 12-year loan in an amount in excess of $100 million with a fixed interest rate of less than four percent. Vietnam Airlines will receive one aircraft this year, and the other two between 2004 and 2005.
Pillsbury Winthrop LLP acted as legal counsel to Citibank in the transaction. Partner Michael Schumaecker of the New York office led the Pillsbury Winthrop team, working with senior associate Charlotta Otterbeck and associate Mark Lessard of the New York office.
“Pillsbury Winthrop’s team of equipment finance and leasing attorneys combined broad-based skills to provide advice on the full range of issues presented by this complex cross-border financing,” notes Michael Schumaecker, partner with Pillsbury Winthrop’s New York office.