* Gol mulls increasing orders as it ponders expansion
* Gol CFO sees Webjet purchase to produce $63 mln savings
* Webjet purchase signals Gol's aggressive growth plan
(Updates with comments, details on cost savings, possible
Boeing order; adds byline)
By Alberto Alerigi Jr.
SAO PAULO, July 11 Brazilian airline Gol Linhas
Aereas (GOLL4.SA)(GOL.N) is considering increasing its orders
for Boeing Co (BA.N) aircraft over the next two years after its
purchase of rival Webjet, Chief Executive Constantino de
Oliveira Jr said on Monday.
Gol, Brazil's second-biggest airline, would like to replace
Webjet's aging 737-300 Boeing jets with 737-700 and 737-800
Next Generation planes, which Gol currently operates, Oliveira
told reporters in a conference call. Last year Gol ordered 30
737-800 NG jets that should arrive between 2014 and 2017.
A firm order could help boost the efficiency of Webjet's
service at a time when competition is mounting with smaller
carriers, Oliveira said.
The purchase of Webjet, announced on Friday, will make Gol
the largest carrier in eight of the 10 busiest domestic
"There is the possibility that we increase our Boeing
order, but one problem is, should I place such an order today,
I would only get those planes by 2016," the Gol CEO said. "That
would not resolve the short-term squeeze we are faced with."
Oliveira did not elaborate on the size of the possible,
Gol will pay 96 million reais ($60 million) to Webjet
shareholders and assume about 214 million reais of Webjet debt.
Gol Chief Financial Officer Leonardo Pereira estimated that
potential cost savings resulting from the merger of the
companies could reach 100 million reais.
The price being paid to shareholders is equal to 4.7
percent of Gol's outstanding cash balance at the end of the
first quarter, according to Thomson Reuters estimates.
Pereira said Gol plans to stretch out payment terms and
lower borrowing costs for Webjet's debt, which has maturities
between 2011 and 2015.
"The synergies from the acquisition could be significant,
including higher fares, lower modified net debt, as Gol
possibly negotiates better lease rates and, or, modernizes
Webjet's fleet ... and increased fixed cost dilution from the
greater capacity growth," Citigroup transport analyst Stephen
Trent said in a note to customers on Monday.
Shares of Gol fell 1.7 percent to 19.43 reais in
(Additional reporting and writing by Guillermo Parra-Bernal in
Sao Paulo; Editing by Gerald E. McCormick and John Wallace)