In February 1996, Trans World Airlines (TWA) agreed to acquire 20 Boeing 757-200s, in a deal valued

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In February 1996, Trans World Airlines (TWA) agreed to acquire 20 Boeing 757-200s, in a deal valued at about $1 billion. Of the 20 planes, 10 would be purchased directly from Boeing. However, the remaining 10 were to be obtained through International Lease Finance Corp., a Century City, California, firm, on a 10-year lease.

Why wouldn’t TWA just purchase all 20 planes? That is, why lease 10?

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Fundamentals Of Corporate Finance

ISBN: 9780072553079

6th Edition

Authors: Stephen A. Ross, Randolph Westerfield, Bradford D. Jordan

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