Airborne Capital said the Edmonton-based discount airline ‘regularly’ defaulted on millions of dollars in payments over a five-month period
The leasing company that seized four Flair Boeing 737s on the weekend said it did so only after the Edmonton-based discount airline “regularly” defaulted on millions of dollars in payments over a five-month period.jets late Friday and early Saturday at airports in Edmonton, Toronto and Waterloo, Ont. Officials issued lease termination notices that grounded the planes, and took the maintenance records and other documents ahead of one of the year’s busiest travel days.
Flair chief executive officer Stephen Jones said he was surprised by the seizures. He said it was “aggressive” and “draconian” directed by impatient New York hedge funds because Flair was just US$1-million behind in its payments. He also says rival airlines are behind the move to reduce Flair’s fleet for competitive reasons.But in a statement issued on Tuesday, Airborne said it “strongly rejects” Mr. Jones’s statements, and says the amount owed was in the millions of dollars.
“The leasing of the four Airborne-managed aircraft was terminated following a five-month long period, during which Flair was regularly in default of its leases by failing to meet its payments when due, with payment arrears reaching millions of dollars,” said Airborne, in its first public comments on the matter.
“Throughout this period, senior Airborne executives were in direct and regular contact with representatives of Flair, reminding them of their legal obligations. However, missed payments and lease defaults persisted.”Mr. Jones, in an hour-long webcast to the airline’s employees on Monday, said Flair missed “a series” of payments to Airborne before the seizures. He said Flair paid $4.2-million to the lessor on Feb.
Mr. Jones’s description of the events and the financial transactions offer more details than his recent
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