4 ms·
Letter of intent. Not a contract. The article is speaking like it's a done deal.
by oniony 11y ago
Letter of intent. Not a contract. The article is speaking like it's a done deal.
- tewarbit 11y agoThe article explicitly states: "Now, this doesn’t mean that Virgin has bought the planes — it’s a bit too early for that. They’ve signed a letter of intent, meaning that, having seen the nitty-gritty specs of the plane and the company’s plans for moving forward, they intend to buy 10 planes if everything comes together as planned."
- dandermotj 11y agoThe article first states that they've optioned a purchase - so I assume they've purchased some sort of call option and Boom are the issuers which would mean that some money has changed hands.
- D_Alex 11y agoI doubt any money has changed hands (if it has, Boom would trumpet the figure). This is a pure publicity move for both Boom and Virgin. I doubt, tbh, that Virgin rates highly the chances for this to succeed, but they lose nothing by saying that if the plane is as magnificent as promised, they will buy a bunch.
- dandermotj 11y agoIf they purchased an option then Virgin paid for it. Optioning purchases is a common instrument traded in aviation finance. The option to buy this aircraft at some point in the future at a price specified today is worth a lot. The fact that it's a moonshot only means the price of the option would be reduced. If the plane is as magnificent as promised, Boom's order books will be filled for decades and other airlines will be second in line to Virgin.