Hahn, Avital Louria
May 2003
Investment Dealers' Digest;5/19/2003, Vol. 69 Issue 20, p8
Trade Publication
If a proposed lease between aircraft company Boeing Co. and the U.S. Air Force for 100 Boeing 767 refueling tanker jets gets approved, New York Stock Exchange may find itself underwriting an advantage of nearly 17 billion dollars in government-backed securities. If successful, the securitization may become a new financing method for the government and a new source of fees for the exchange, say bankers. It appears that the structure has been able to withstand new accounting rules that require special purpose vehicles (SPVs) to go back on the balance sheet. Citigroup Inc. is advising Boeing on the structure, an SPV which will buy the airplanes from Boeing. Boeing will retain no interest in the planes, according to a source close to the situation. Air Force usually buys its equipment, but in this case buying the tankers outright would cost in the neighborhood of 100 billion dollars, which the government can't afford.


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