EFIC assists Australian exporter with aircraft hangar projects in Abu Dhabi and Ho Chi Minh City
Export Finance and Insurance Corporation (EFIC) is helping Sydney-based Aircraft Support Industries Pty Ltd (ASI) to fulfil two contracts, together worth US$81.9 million, for the design and construction of aircraft maintenance hangars at Abu Dhabi International Airport in the United Arab Emirates and at Tan Son Nhat Airport in Ho Chi Minh City, Vietnam.
For the US$68.2 million Abu Dhabi contract, ASI will supply the hangar complex, which can accommodate the A380 aircraft, as well as associated workshops, offices and equipment, to Abu Dhabi Aircraft Technologies (ADAT), which provides technical services for the commercial and military aviation industries.
In Ho Chi Minh City, ASI will supply a wide-body aircraft hangar at one of Vietnam Airlines’ main aircraft maintenance bases. ASI’s US$13.7 million contract is with Vietnam Machinery Installation Corporation (LILAMA), a state-owned company contracted for the project by Vietnam Airlines.
Each contract required ASI to provide a performance bond for 10% of the contract value. EFIC has assisted with the provision of the bonds by issuing guarantees to ASI’s bank, National Australia Bank (NAB).
Backed by EFIC’s guarantees, NAB has issued a standby letter of credit to a bank in Abu Dhabi and one in Vietnam, which have in turn issued a performance bond to ADAT and LILAMA respectively.
‘We have strong experience in designing and constructing large hangars both in Australia and overseas, but contract bonds can place a strain on our cash flow,’ said ASI’s chief executive officer, Mark Langbein. ‘The financial guarantees from EFIC and NAB have freed up our working capital so we can focus on delivering these new contracts.’
EFIC has assisted ASI with export finance since 2001. In addition to the two new contracts, EFIC recently provided bonds to support the company’s projects in Jordan and Singapore.
‘We’re proud to build on our relationship with such a successful Australian exporter,’ said EFIC’s managing director, Angus Armour. ‘Our bonds can help specialised exporters like ASI to develop niche markets in a highly competitive environment.’
Over the past 15 years, ASI has completed 10 major hangar projects and over 12 aircraft maintenance docking systems, both in Australia and in overseas markets including Singapore, China, Taiwan, Malaysia and Brunei.