As France is quarantined, EasyJet shores up its finances by selling planes for £600 million to Chinese bank

EasyJet today sold 23 of its aircraft to financiers including a Chinese state controlled bank for £608 million in a deal taking the total it has raised to shore up its finances in the face of the Covid-19 crisis to £2.4 billion.

Like all airlines, easyJet has been forced to go to extreme lengths to raise funds to cover refunds for cancelled flights and everyday overheads at a time of massively limited income.

As well as raising £600 million of UK government covid loans, it has negotiated extra overdraft facilities and bank loans and raised money by issuing new shares.

Today, it added to that tally by selling 23 aircraft at a price towards the upper end of the expected £500 million to £650 million range first announced in May.

The airline will now lease back the planes.

Among the companies buying them was the Chinese banking giant Bank of Communications, whose Bocomm Leasing arm stumped up £203 million for the sale and leaseback of five Airbus A321neo planes.

Chinese companies have been increasingly active in the European travel and aviation sector, taking big stakes in Thomas Cook prior to its collapse and the airline Norwegian.

Security sources have been concerned about the country's increasing influence in the industry and some blamed China was responsible for a major and sophisticated hack into easyJet's IT systems revealed in May. China denies conducting offensive cyber operations and easyJet has declined to say where the hack is suspected to have come from.

EasyJet has long prided itself on its conservative financial structure in that it owns its fleet. However, it has had to relax that stipulation to raise emergency cash during what is the worst crisis the industry has ever faced.

Last night's imposition of quarantine measures on France will add further pressure to its network, particularly its popular routes for summer sunseekers into Marseille, Nice and Bordeaux. The airline only resumed limited flights to France on June 15.

Following the conclusion of the sale and leaseback programme around 50% of easyJet's fleet remains "unencumbered" - not mortgaged out to finance companies.