Monday March 30, 9:42 am Eastern Time
Gulfstream in deal with Mideast investors
SAVANNAH, Ga., March 30 (Reuters) - Gulfstream Aerospace Corp. on Monday announced a contract worth $335 million with a group of Middle East investors to buy 12 Gulfstream IV-SP aircraft, in the first program of its kind in that region to meet the growing need for private aircraft ownership.
The deal expands Gulfstream's fractional ownership program, which offers one-eighth, one-quarter and one-half shares in Gulfstream aircraft, and allows customers with limited aviation requirements to own the business jet aircraft.
With the deal, sales of Gulfstream shares will begin immediately and the first new Gulfstream IV-SP is expected to enter service in early 1999, with deliveries continuing through 2003, the company said.
Gulfstream said the deal with the Middle East investors requires ''modestly different deposit requirements'' early in the program. As a result, Gulfstream has decided for the initial phase of the program to book these aircraft when delivered. As of Dec. 31, 1997, it reported a firm contract backlog of 88 aircraft, representing about $2.8 billion in future revenues.
Gulfstream will provide two core fleet aircraft as well as technical, sales and marketing staff. Gulfstream service centers in Europe will provide aircraft maintenance.
The Middle East investors, who were not named, will manage the program, including share sales and marketing, with Executive Jet Inc.
The Gulfstream Shares Program currently has 15 Gulfstream aircraft operating in the U.S. program.
Shares in Gulfstream were 9/16 higher at 43-1/8 in early trading on the New York Stock Exchange.
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