The UK Minister for Defence Equipment and Support, Lord Drayson today announced that the Government had approved a Private Finance Initiative (PFI) solution as the most cost-effective way of replacing the RAF’s fleet of VC10 and TriStar aircraft. The Ministry of Defence will now proceed towards financial and contractual close of the FSTA PFI deal with AirTanker Ltd. In turn, AirTanker has announced the launch of the Financing Competition to raise circa £2 billion capital investment for the UK’s Future Strategic Tanker Aircraft (FSTA) Private Finance Initiative programme.
Commenting on the announcement, the joint EADS CEO’s Thomas Enders and Louis Gallois said: “As the largest shareholder in AirTanker and supplier of the aircraft, EADS fully supports the efforts made by all the members of the AirTanker team working alongside the MOD to conclude the details of this groundbreaking PFI deal. EADS believes that for long term service based solutions like FSTA, or the already operational Skynet 5, PFI will offer substantial benefits to both the Customer and the service provider.”
The Financing Competition intends to raise circa £2 billion from international financial institutions. AirTanker is being advised by Deutsche Bank. The fundraising and the overall PFI format of the programme is designed to provide the most cost-effective means of procuring and operating the FSTA capability for the MoD and the UK taxpayers over a 27 year term. The funding raised by the Financing Competition will be used to fund the establishment of the business, to procure the Airbus A330-200 tanker transport aircraft fleet and to build the new facilities from which AirTanker will operate the FSTA service.
Robin Southwell, CEO of EADS UK, added: “Let nobody be in any doubt that we are convinced this business represents excellent value for money to the taxpayer and an enhanced capability for the RAF.”
AirTanker, of which EADS holds 40% alongside Cobham (13.33%), Rolls-Royce (20%), Thales UK (13.33%) and VT group (13.33%) was selected as Preferred Bidder to operate the service for the Royal Air Force in 2005. AirTanker will replace the existing fleet of VC-10 and TriStar aircraft with the latest Airbus A330-200 transport and tanker aircraft, and will provide the ongoing air transport and refuelling capability to the RAF through a 27-year PFI contract with the UK’s Ministry of Defence (MoD).
Military Transport Aircraft Division is responsible within the EADS Group for all the military derivative programmes based on Airbus platforms and it will be responsible for the transformation into tanker/transport of these 14 units for the RAF.
The fleet will be owned and supported by AirTanker. The RAF will have complete operational control, and will fly the military missions. AirTanker will be paid according to the extent of the RAF’s use of the service.
EADS is a global leader in aerospace, defence and related services and employs a workforce of more than 116,000. The Group includes the aircraft manufacturer Airbus, the world's largest helicopter supplier Eurocopter and EADS Astrium, the European leader in space programmes from Ariane to Galileo. EADS is the major partner in the Eurofighter consortium, develops the A400M military transport aircraft through its MTAD Division, and holds a stake in the joint venture MBDA, the international leader in missile systems.
