Chorus Aviation to acquire five Bombardier CRJ900 aircraft
Apr 26, 2016
Existing Q400 and CRJ705 aircraft to be reconfigured
HALIFAX, April 26, 2016 /CNW/ - Chorus Aviation Inc. ('Chorus') (TSX: CHR.B CHR.A) today announced that it has signed a firm purchase agreement to acquire five Bombardier CRJ900 regional jets, with firm purchase rights for five additional aircraft. As announced on September 28, 2015, the five firm aircraft will be operated under the Air Canada Express brand as per Jazz's Capacity Purchase Agreement ('CPA') with Air Canada. Chorus has arranged financing in support of this acquisition to be drawn at the time of closing.
The new CRJ900 aircraft will be leased into the CPA operation under terms and economics similar to those of the Q400 aircraft currently leased to the CPA.
These five 76-seat CRJ900 regional jets will enter into service in early 2017. As part of its fleet standardization plan, Jazz will reconfigure its existing 16 75-seat CRJ705 aircraft to 76-seats, thereby converting the CRJ705s to CRJ900 regional jets as agreed to with Air Canada. The aircraft will be configured in two classes of service with 12 seats in business class and 64 seats in economy class, including 20 preferred economy seats. Both cabins will feature seatback in-flight entertainment systems and Gogo wireless internet access.
"The ongoing modernization of the Jazz fleet is strengthening our ever-improving cost competitiveness in the North American market," said Joseph Randell, President and Chief Executive Officer, Chorus. "The addition of these new CRJ900s reduces unit costs and complements our fleet of Canadian-built Bombardier turboprops and regional jets. The advanced technology, fuel efficiency and passenger comfort of this aircraft offer a reliable and cost-effective regional jet solution for our growing fleet."
Jazz will also reconfigure 21 Q400 NextGen aircraft currently in its CPA covered fleet with an additional four seats to a 78-seat configuration. The all-economy cabin will have 10 preferred economy seats.
The reconfiguration of the 16 CRJ705 and 21 Q400 aircraft currently in Jazz's fleet will be performed by Jazz's Maintenance and Engineering Division, with the assistance of Bombardier Commercial Aircraft, and is expected to be completed by year end 2017.
Forward Looking Statements
Certain statements in this news release may contain statements which are forward-looking. These forward-looking statements are identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar terms and phrases, including references to assumptions. Such statements may involve but are not limited to comments with respect to strategies, expectations, planned operations or future actions.
Forward-looking statements relate to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and other uncertain events. Forward-looking statements, by their nature, are based on assumptions, including those described below, and are subject to important risks and uncertainties. Any forecasts or forward-looking predictions or statements cannot be relied upon due to, amongst other things, changing external events and general uncertainties of the business. Such statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements to differ materially from those expressed in the forward-looking statements. Results indicated in forward-looking statements may differ materially from actual results for a number of reasons, including without limitation, risks relating to Chorus' relationship with Air Canada, the airline industry, airline leasing, energy prices, general industry, market, credit, and economic conditions, (including a severe and prolonged economic downturn which could result in reduced payments under the amended CPA), competition, insurance issues and costs, supply issues, war, terrorist attacks, aircraft incidents, epidemic diseases, environmental factors, acts of God, changes in demand due to the seasonal nature of the business, the ability of Chorus to reduce operating costs and employee counts, the ability of Chorus to secure financing, employee relations, labour negotiations or disputes, pension issues, currency exchange and interest rates, leverage and restructure covenants in future indebtedness, uncertainty of dividend payments, managing growth, changes in laws, adverse regulatory developments or proceedings, pending and future litigation and actions by third parties. The forward-looking statements contained in this discussion represent Chorus' expectations as of April 26, 2016, and are subject to change after such date. However, Chorus disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.
Chorus is traded on the Toronto Stock Exchange under the trading symbols of CHR.A and CHR.B.
Headquartered in Halifax, Nova Scotia, Chorus was incorporated on September 27, 2010 and is a dividend-paying holding company with various interests including Jazz Aviation Holdings Inc. and Chorus Aviation Holdings II Inc.
SOURCE Chorus Aviation Inc.
For further information: Chorus Media Contacts: Manon Stuart, Halifax, Nova Scotia, (902) 873-5054, firstname.lastname@example.org; Teri Udle, Halifax, Nova Scotia, (902) 873-5047, email@example.com; Debra Williams, Toronto, Ontario, (905) 671-7769, firstname.lastname@example.org; Analyst Contact: Nathalie Megann, Halifax, Nova Scotia, (902) 873-5094, email@example.com