Nepal Airlines Corporation Seeks $1.01 Billion in Loans, Issues Second Notice Due to Lack of Lender Interest

Nepal Airlines Corporation (NAC), faced with a lack of interest from international lenders, has issued a second expression of interest, inviting both domestic and international institutions to provide loans. The corporation aims to secure funds totaling $1.01 billion (Rs 135 billion) to address its financial obligations.

In its renewed call for financial support, published on Wednesday, NAC emphasizes the urgency of securing lending partners, setting a deadline of April 11, 2024. This move follows the initial notice issued on January 23, which failed to elicit any responses within the stipulated 45-day period.

The invitation extends to a diverse range of entities, including domestic and foreign government institutions, as well as non-governmental financial organizations. The proposed loan allocation seeks Rs 55 billion ($415 million) for debt management or debt restructuring with international creditors. Additionally, NAC is seeking Rs 75 billion ($565 million) for the acquisition of new aircraft and Rs 5 billion ($38 million) earmarked for hangar infrastructure development.

Outlined within the proposal is the intention for the loan to be structured with a conventional fixed interest rate, with a repayment period spanning 25 years, potentially extendable through mutual agreement.