A London High Court has ordered VietJet Aviation JSC to pay US$181.5 million to aircraft lessor FW Aviation, rejecting the airline’s request to delay payments and ruling it has the means to comply, Bloomberg has reported. The decision follows a prolonged legal battle stemming from VietJet’s default on lease payments for four Airbus aircraft during the pandemic.
The article notes that:
- Payments must be made in three US$60.5 million instalments, beginning May 15 and ending November 28, despite VietJet’s claim that it may need to dismantle parts of its business to comply.
- The court rejected the airline’s argument that it lacked liquidity, citing its continued ability to enter large contracts for new jets; VietJet warned the judgment could trigger fleet groundings, refund liabilities of US$600 million, and even liquidation.
- VietJet has said it risks losing US$500 million in pre-delivery payments for 318 jets if it defaults, with potential cross-defaults jeopardising bond and loan agreements.
See also: The VietJet UK Court Ruling for Foreign Firms in Vietnam: Unpacked