by Christopher Freeburn | June 12, 2012 9:40 am
NetJets announced on Monday that it will purchase as many as 425 new planes from Textron‘s (NYSE:TXT) Cessna and Bombardier (TSE:BBD.A).
Owned by Berkshire Hathaway (NYSE:BRK.A, BRK.B), iconic billionaire Warren Buffett’s investment company, NetJets sells fractional ownership in jets to businesses and individuals.
The company indicated that it will purchase at least 100 Challenger business jets from Bombardier, with the option to acquire up to 175 others, for $7.3 billion. The remainder of the order consists of at least 25 Cessna Citation Latitude business planes, and an option to purchase 125 more, Reuters noted.
NetJets will receive the Bombardier planes beginning in 2014; the Cessna planes will start arriving in 2016.
Once a rare loser in Berkshire Hathaway’s portfolio, NetJets has recently returned to profitability and lowered its debt.
The company ordered up to 120 planes from Bombardier for $6.7 billion last year.
Analysts cited by Reuters described the NetJets order as representing “several years worth of business” for Bombardier. They also noted that plane orders from NetJets sometimes “fall by the wayside, for market reasons or company reasons.”
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