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EasyJet Places $3.3 Bln Order For 270 CFM Engines

CFM International, a 50/50 joint company between France-based aerospace and defense company Safran SA (SAFRY, SAFRF) and diversified conglomerate General Electric Co. (GE), said Monday that European low-cost airline easyJet plc (ESYJY,EZJ.L) has placed a firm order with the company for 270 engines.

The engine order, including 200 LEAP-1A engines to power its Airbus A320neo family aircraft and 70 CFM56-5B engines to power additional A320ceo aircraft, is valued at more than $3.3 billion at list price.

CFM International, is a supplier of commercial aircraft engines. The company has delivered more than 26,500 CFM56 engines to date.

Carolyn McCall, easyJet Chief Executive of easyJet said, "We are pleased to have signed a deal with CFM - a company with which we have a long history and a great working relationship - and look forward to introducing the new LEAP-1A engine into our fleet. The engines will help easyJet to maintain its low cost base and the new generation A320neo is expected to deliver a cost per seat saving of between 11% and 12% compared to the current generation A319."

easyJet also has purchase rights for an additional 100 Airbus A320neo aircraft. The orders for the 100 A320neo and 35 A320ceo aircraft were originally announced in July 2013.

easyJet has been a CFM customer since 1995. Its entire fleet is powered by CFM56 engines, with the airline operating 225 CFM56-5B-powered A320-family aircraft.

CFM International noted that the LEAP engine will provide up to a 15 percent improvement in fuel consumption and CO2 emissions compared to today's best CFM engine, along with a dramatic reduction in engine noise.

The first full LEAP-1A engine began ground testing in September 2013, two days ahead of schedule. The total ground and flight test certification program encompasses three LEAP engine variants, includes 28 ground and CFM flight test engines, along with a total of 32 flight test engines for Airbus, Boeing, and COMAC.

The LEAP engine has 6,770 orders on the books as of June 30, 2014.

GE is currently trading at $26.78, up $0.24 or 0.89 percent on a volume of 9.48 million shares. SAFRY is trading at $15.96, down $0.01 or 0.03 percent on a volume of 5,060 shares.

ESYJY is trading at $87.75, up $1.75 or 2.03 percent on a volume of 800 shares.

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