Kuwait’s privately owned airline Jazeera Airways is looking to raise financing for three A320 aircraft.

The aircraft are the final planes to be delivered from a 15-aircraft order with Airbus.

Jazeera is preparing a request for proposal (RFP), which will be sent out to banks before the end of November. It will be looking to raise approximately $120m.

Previously the airline has used export credit agency (ECA)-backed financing to support its aircraft orders. The twelfth aircraft from the Airbus order was delivered this year and financed through a loan backed by European ECAs, including France’s Coface and the UK’s ECGD.

In 2010, the airline financed its eleventh A320 with a $105m financing arranged by France’s Natixis and backed by European ECAs.

However, Jazeera Airways will look at a variety of financing options this time.  

Don Hubbard, chief financial officer at the airline, says he is concerned that although ECA financing is traditionally a cheaper way of financing aircraft, given the impact of new regulations, including Basel III, other financing options could be more attractive.

“[It] may be that going the ECA route is too expensive. It depends on what the premiums will be,” he says.

He argues that banks should look to support the airline’s aircraft order and he would be particularly keen to see Kuwaiti banks step in to finance the deal.

“We have a strong balance sheet at the moment,” Hubbard says.

His comments follow the release of the airline’s third quarter results, which were the strongest quarterly results for the company to date. Operating profit increased by 17.9 per cent year-on-year to KD8.8m ($31m) and revenue increased by 5.9 per cent year-on-year to KD20.4m.

Jazeera is planning to raise its capital to KD42m through a rights issue of 200 million shares. Hubbard says this rights issue is “imminent” and should happen before the end of the year.