Russia’s Aeroflot bought 10 Boeing 777 from Russian bank VEB – sources

(Reuters) – An Irish lessor that sold 10 Boeing 777-300ER aircraft to Russia’s flagship carrier Aeroflot last year was a local subsidiary of state controlled Russian development bank VEB, two sources familiar with the matter told Reuters.

State-controlled Aeroflot announced on Dec. 30 that it had bought 10 Boeing 777-300ER long-haul planes it previously leased from an Irish company, which it refused to name.

The carrier said the planes have been leased by Aeroflot since 2013 and 2014 and they were leased under a finance lease deal, which means that the lessee receives ownership rights to the asset after paying the entire amount, as opposed to a more typical deal when ownership stays with the lessor.

Aeroflot and VEB-Leasing, a part of VEB Group, did not immediately respond to requests for comments.

According to the list of Russian aircraft published by flight tracking website FlightRadar24 and to the Bermuda Civil Aviation Authority (BCAA), Aeroflot had been operating 22 Boeing 777s in March last year, 10 of which it owned itself and 10 of which it leased from Russian and Chinese lessors.

Aeroflot said in December that it will continue to work on further aircraft buyouts in order to maintain its fleet of foreign-made aircraft.

After Moscow started what it calls its “special military operation” in Ukraine, the West responded with unprecedented sanctions, banning Western companies from working with Russian airlines, most of which operate Western passenger jets, and forced lessors to cancel contracts with them.

To protect domestic flights, Moscow re-registered the aircraft in Russia and refused to allow some of them to leave, stranding almost $10 billion worth of aircraft in Russia.

Russian airlines continue to operate many of the jets, but some have struggled to secure replacement parts.

Russian airlines have held exploratory talks with at least one major Western leasing firm about using state funds to buy some of the more than 400 aircraft stranded in Russia, according to documents and sources.

(Reporting by Gleb Stolyarov; Editing by Alexandra Hudson)