Leasing company seizes Brazilian airline's jet in Miami

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Leasing company seizes Brazilian airline's jet in Miami


The Associated Press
3/6/03 9:48 PM



RIO DE JANEIRO, Brazil (AP) -- A Brazilian-bound Varig airlines jet was
seized at the Miami airport on Thursday by the leasing company that owns
it.


Varig spokesman Paulo Cesar Fonseca said the Boeing 767 was among 13
planes the airline leased from General Electric Capital Aviation
Services. Varig intended to return it to the leasing company, Fonseca
said. He said he didn't know if Varig owed the company money.


Passengers on the flight to Rio de Janeiro were transferred to other
Brazil-bound flights, Fonseca said.


"We had told the company we were planning to return the planes and we
have entered into contact with the company to learn why it was seized,"
Fonseca said.


In January, a division of insurance giant American International Group
repossessed a Boeing 777 from Varig at Paris' Charles de Gaulle airport
for lack of payments.


Brazil's airlines have been hit hard by a slump in demand caused by a
sluggish economy and a plunge in travel following the Sept. 11 attacks
in the United States.


Varig is struggling under more than $746 million in debt. Brazilian
regulators have asked the company to restate financial results for 2001
and the first half of 2002, after officials found $359 million in
accounting errors.


Last month, the airline announced it would merge with another Brazilian
airline, TAM, to create a new carrier. The merger follows years of
financial troubles and a steep plunge in business.

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