Court documents showed that state-owned Saudi Arabian Airlines is facing a lawsuit in London’s High Court last month by a financial services firm in connection with allegations of violating agreements to lease 50 Airbus planes.
But the airline said in a statement to Reuters that it was in compliance with its contractual obligations and prepared to defend itself against any unfounded claims.
Alef, which specializes in chartering aircraft in accordance with Islamic law, has filed a lawsuit against the Jeddah-based carrier, claiming an unpaid rental value and maintenance costs of at least $ 460 million.
The Dubai-based company has also demanded compensation for damages and other costs, according to documents reviewed by Reuters.
The Supreme Court informed Reuters that the lawsuit had been brought but the defendant had not yet reported receiving notification.
Saudi Airlines declined to comment on the specifics of the case, but said the litigation process had not yet started. “We are in discussions with the landlord to settle contractual disputes, and we believe common sense will prevail in the end,” the company said.
Airbus had announced the deal for Alef and Saudi Airlines during the Paris Air Show in 2015, hailing it as the largest air deal ever concluded through Islamic finance. The value of the fifty aircraft, which make up a third of Saudi Airlines’ fleet, was about $ 8.2 billion at the time.
Under the agreement, the management unit of Alef, the International Air Finance Corporation, purchased the aircraft, 30 A320neos and 20 A330-300s, and leased them to Saudi Airlines.
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