VarigLog requests financing to acquire 50 Embraer airplanes

24 August 2006

Sao Paulo, Brazil, 24 Aug – VarigLog Wednesday asked Brazilian economic and social development bank Banco Nacional de Desenvolvimento Económico e Social (BNDES) for financing to acquire 50 Embraer airplanes, the company announced.

VarigLog requested a loan of US$ 1.7 billion to acquire 50 model 195 airplanes, which can transport between 115 and 135 passengers.

Embraer owns a factory in China and has been selling airplanes to Chinese airlines.

If the request is accepted, Varig will be the first Brazilian airline to benefit from a series of loans to acquire Embraer planes, recently created by BNDES, the Brazilian state-owned bank for financing projects that are considered to contribute the development of the country.

On July 20 VarigLog won the auction of airline Varig for the minimum price of US$24 million, and proceeded to announce the cancelling of numerous flights, part of the strategy to restructure the operations of the company.

Varig also announced that it would cut 5,500 employees, part of a process of “adapting the staff to the real operational needs at the moment.” (macauhub)