BOC Aviation agrees to buy 10 Boeing 737-700s

BOC Aviation, Asia's largest aircraft lessor, agreed to buy 10 Boeing 737-700s from Southwest Airlines Co and lease them back to the carrier, BOC Aviation Chief Executive Officer Robert Martin said yesterday.

Southwest Airlines, the largest United States discount carrier, said on Tuesday proceeds from the sale of the first five aircraft were US$175 million. The Dallas-based airline expects to complete the transaction for the second group of jets next quarter on similar terms, adding that it will lease the planes for 12 years.

BOC Aviation, Bank of China Ltd's aircraft-leasing unit, has said it has more than US$1 billion to purchase planes as rivals conserve cash and avoid new deals amid a global credit squeeze. The credit market meltdown has caused banks worldwide to curb lending, which could leave as much as US$20 billion of aircraft arriving next year without financing, analysts have said.