The Wall Street Journal

THE WALL STREET JOURNAL WEDNESDAY, MAY 31, 1995

Delta Air Inventory Valued at $400 Million Sold to Joint Venture

By a Wall Street Journal, Staff Reporter

ATLANTA - Avatar Alliance L.P. of Stratford, Conn., said it acquired “a substantial portion” of Delta Air Lines’ inventory of spare parts, accessories, avionics and engine components. Financial terms weren’t disclosed. Avatar estimated the value of the spare parts at more than $400 million. A spokesman for Delta said he didn’t have any estimate of the value of the parts. The spare parts were sold as part of Delta’s wide-ranging effort to cut its costs by $2 billion a year by 1997. The airline said it had surplus spare parts for 12 models of aircraft, including several that aren’t in its fleet any longer.

Avatar Alliance, a joint venture of six technical-, financial- and asset-management firms, said it intends to esell the Delta spare parts. Avatar said it is also seeking additional inventory acquisitions from other airlines.

Avatar said the Delta parts acquisition includes about 17 million individual parts for 12 aircraft models: the Airbus Industrie A-300 and 310; Boeing 737-200 and 300, 747, 757, and 767; the Lockheed L-1011; and McDonnell Douglas DC-9, DC-10, MD-82/88 and MD-11.