March 16, 2008 / 11:55 AM / 11 years ago

UPDATE 1-Israel's El Al buys 4 Boeing 777s for $540 million

(Adds details, background, share price)

TEL AVIV, March 16 (Reuters) - El Al Israel Airlines (ELAL.TA) said on Sunday it had ordered four Boeing Co (BA.N) 777-200ER planes for $540 million.

The passenger aircraft with 279 seats will be equipped with Rolls Royce engines and used on medium- and long-haul routes. Three will be delivered in 2012 and one in January 2013.

El Al announced last Wednesday that it was in talks with Boeing to buy the planes. The order was signed on Sunday in El Al’s offices.

The carrier said it would have the option to convert its purchase to 777-300 jets, which have 350-400 seats, with a decision to be taken by year-end.

El Al operates an all Boeing fleet, including six 777 aircraft.

The airline recently purchased two 777s which are used on flights to the United States and Asia.

In the summer of 2008, El Al is expected to take delivery of two short-haul Boeing 737-800 planes with another three arriving in 2009.

The Israeli carrier said the acquisition of additional aircraft would improve its ability to compete with foreign airlines flying to Israel and would serve to meet rising demand for medium- and long-range flights.

El Al’s shares were down 3.1 percent in afternoon trading, compared with declines of about 2 percent in the broader Tel Aviv market.

Reporting by Tova Cohen; Editing by Jason Neely

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