Sanad, a global aerospace engineering company, has finalized a $408 million transaction with Etihad Airways to purchase and lease back jet engines, marking a significant expansion of their partnership. The deal involves the sale of aircraft engines from Etihad’s fleet, enhancing the carrier’s financial flexibility and operational efficiency. By offloading these high-value assets, Etihad secures long-term funding while maintaining access to crucial engines through leaseback agreements, ensuring continuity in operations.
Under the agreement, Sanad will purchase a fleet of General Electric (GE) and Rolls-Royce engines, used across Etihad’s passenger and cargo planes. The engines will be leased back to Etihad on long-term contracts, a move that provides Etihad with liquidity while mitigating risks related to asset depreciation. This collaboration comes as part of Sanad’s broader mission to position Abu Dhabi as a leading hub for aviation and aerospace innovation, fostering the region’s industrial and technological advancements.
Etihad Airways has previously engaged in similar deals, leveraging sale-and-leaseback structures to streamline financials while maintaining operational stability. This transaction underscores both companies’ confidence in their strategic relationship, especially as the aviation sector grapples with economic pressures and the ongoing demand for optimized fleet management.
Sanad’s CEO, Mansoor Janahi, emphasized the importance of this agreement in strengthening Abu Dhabi’s presence in the global aerospace market. The deal also reflects Etihad’s commitment to maintaining financial prudence while continuing to invest in long-term growth initiatives.
For Etihad, this deal aligns with broader efforts to maintain financial stability and enhance fleet efficiency. By selling the engines to Sanad, the airline can utilize immediate capital to address other operational and strategic goals, while retaining the ability to use the engines via leaseback arrangements. This move is particularly important as Etihad continues to navigate fluctuating market conditions and strives for sustainable growth.
This latest deal highlights Sanad’s ongoing ambition to expand its portfolio of aviation assets and services. By acquiring Etihad’s engines, Sanad bolsters its capabilities in aviation leasing, making it a stronger player in the aerospace finance sector. As a subsidiary of Mubadala, Sanad benefits from strong backing and alignment with Abu Dhabi’s long-term goals for economic diversification, including the development of high-tech industries like aerospace.
Etihad Airways, meanwhile, remains focused on achieving financial resilience while continuing its global expansion. The airline has consistently employed innovative financing methods like sale-and-leaseback agreements to optimize its balance sheet. With this transaction, Etihad is expected to enhance its liquidity position, allowing it to reinvest in other areas, such as expanding its route network, improving customer experience, and bolstering its sustainability efforts.
