Blue Air cancels USD 462 mln Boeing order due to owner Asphalt King Iordache's financial and legal strife

Blue Air, the Romanian low-cost airline controlled by businessman Nelu Iordache, has just cancelled an order placed in 2008 for five Boeing airplanes for a total of USD 462.2 million, according to business newspaper Ziarul Financiar. The airplanes, which were scheduled for delivery in 2015-2016, will not make it to Romanian hangars due to the financial difficulties that the company Romstrade, also part of Iordache’s business empire, is experiencing.

“Air transport company Blue Air has agreed with company Boeing on the cancellation of an order placed in 2008 for five Boeing 737NG planes scheduled to be included in our fleet in 2015-2016,” reads a Blue Air press release on the matter. “This decision is motivated by the financial state of company Romstrade – part of the same group as Blue Air – and by the fact that Blue Air Transport cannot undertake on its own the USD 462.2 million financial obligations under its contract with Boeing.” The order cancellation will have no bearing on the day to day operations of the airline and all flights will run as scheduled, according to the same press release. Blue Air had a turnover of close to EUR 150 million in 2011, 9 percent lower than in the previous year. In December last year, Romstrade, the self- proclaimed “Romanian constructor of European roads”, was served two termination notices from the Romanian National Company of Motorways and National Roads (CNADNR), which instantly deprived the private builder of EUR 54 million worth of potential modernization and construction work. Romstrade entered insolvency shortly after, as did Romstrade Logistic Express, another name in Iordache’s business portfolio. 2012 ended badly for Iordache, also known as the Asphalt King, with 29 days of preventative jail time served early December on account of an alleged EUR 5.5 million EU funds embezzlement. The prospect of more legal trouble on account of money laundering and document forgery was also looming. Iordache is to remain in prison for another 30 days following a court decision issued to this effect at the end of last month. Ioana Jelea, ioana.jelea@romania-insider.com photo source: blueairweb.com