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. Last Updated: 07/27/2016

Airbus Wins $1.8Bln Jets Order with S7

Airbus, the world's largest aircraft maker, won an order Monday from S7 for 25 single-aisle medium-haul A320s valued at $1.75 billion at list prices.

S7, the country's second-biggest airline, will take delivery of the aircraft starting in 2009, CEO Vladislav Filev said at a Paris Air Show briefing.

"This plane is the best choice for most of S7's routes. The new A320s will be a reliable mainstay of the S7 fleet," Filev said at the show, RIA-Novosti reported.

The carrier operates eight leased Airbus A310s and seven leased A319s, and has already announced plans to lease four A320s starting next year.

The airline and larger, state-run competitor Aeroflot are among carriers in Russia seeking to expand their fleets.

"Russia is one of our key markets and we're willing to enhance our presence there," Airbus chief commercial officer John Leahy said at a briefing.

S7's purchase is part of a procurement strategy that will see all the carrier's Soviet-era planes, primarily Tupolev-154Ms, phased out by 2012. S7 hopes to be operating a minimum of 50 short to medium range Airbus aircrafts by that date.

Filev said S7 would seek financing for the deal through a series of syndicated loans.

"We expect Sberbank to play a key role in these syndicated loans," he said.

S7 carried 4.9 million passengers in 2006, the second busiest airline in the country after Aeroflot, which transported 7.2 people in the same period.

The agreement marks the first time S7 has ever purchased planes directly from Airbus, although it is currently leasing eight Airbus A310s and seven Airbus A319s.

Bloomberg, MT