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Exhibit 99.7
Our Ref: 97377/BV/EP/kw
Morgan Stanley Aircraft Finance (MSAF) 30th November, 1997
c/o Wilmington Trust
One Rodney Square
P O Box 551
Wilmington
Delaware 19899
USA
Attention: Mr Kieran O'Keefe
Dear Sirs,
BASE VALUATION OF 33 AIRCRAFT PLUS ONE ENGINE
AS AT 30TH SEPTEMBER, 1997
Further to the instructions of Mr Kieran O'Keefe, Morgan Stanley & Co., we
are pleased to be able to provide our opinion of the adjusted "Base Value" of
each aircraft in the enclosed portfolio of aircraft managed by ILFC as indicated
in the attached table, reference 97377-3009/EP/ADJBV. Our valuation is based on
the portfolio details as provided by Morgan Stanley in the course of the
assignment. The point of valuation is 30th September, 1997.
Airclaims' valuation of the portfolio takes into account data supplied by
Morgan Stanley, including updated information made available in November 1997,
regarding the specification of the subject aircraft, including their type and
variants, years of build, engine types and variants, accumulated airframe and
engine hours and cycles, and serial/line number (where relevant). Information
has also been provided in many cases concerning the airframe and engine
maintenance status, and, where possible or necessary this has been interpreted
or extrapolated and our value opinion adjusted accordingly.
We have additionally referred to the data held in the Airclaims CASE
Aviation Database to supplement and complete the data required for the
valuation, including cumulative airframe hours and cycles and have assumed that,
unless otherwise advised, each aircraft is a typical example of its type, model
and age, and is generally in good condition, with all airworthiness directives
and significant service bulletins complied with.
Airclaims Limited
Cardinal Point, Newall Road, Heathrow Airport, London TW6 2AS
Telephone (44) 181 897 1066 Facsimile (44) 181 897 0300
[LOGO] Telex 934679 http://www.airclaims.co.uk
Registered Head Office as above. Registered in England No. 710284.
VAT Reg. No. 224 196 87
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As requested by MSAF, we have provided our value opinion under BASE VALUE
scenario. Airclaims believes it to be very important that value definitions are
understood by all parties and that such values are always considered in
conjunction with their definitions.
BASE VALUE (TO ISTAT DEFINITION)
The Base Values presented in the attached table are based on the
definitions as outlined by the International Society of Transport Aircraft
Trading (ISTAT). ISTAT's definition of Base Value equates in principle to the
previously used appraisal term, Fair Market Value.
The ISTAT definition is as follows:
A Base Value is the Appraiser's opinion of the underlying economic value of
an aircraft in an open, unrestricted, stable market environment with a
reasonable balance of supply and demand, and assumes full consideration of its
"highest and best use". An aircraft's Base Value is founded in the historical
trend of values and in the projection of value trends and presumes an arm's
length, cash transaction between willing, able and knowledgeable parties, acting
prudently, with an absence of duress and with a reasonable period of time
available for marketing.
In most cases, the BASE VALUE of an aircraft assumes its physical condition
is average for an aircraft of its type and age, and its maintenance time status
is at mid-life, mid-time (or benefiting from an above average maintenance status
if it is new or nearly new, as the case may be).
In this instance, because of the relative youth of the portfolio, all the
Base Values pertaining to the fleet have been adjusted for maintenance status
where available and appropriate.
No physical inspection of the subject aircraft has been undertaken by
Airclaims in conjunction with this assignment, and no attempt made to verify the
information available to us, which therefore assumed to be correct as given.
Abbreviations used on the tabulated valuation pages include:
Type Aircraft type, model and variant
Eng. Engine Type and Variant
MSN Manufacturers Serial Number
REGN Registration
MTOW Maximum Take-Off Weight
ADJ BV Adjusted Base Value
H-L BV Half Life Base Value
Morgan Stanley Aircraft Finance (MSAF)
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Whilst the tabulated values are given as single figures, it must be borne
in mind that the determination of such values involves a multiplicity of
variables, and that some variation in perceived values must be expected, due to
for example, any potential inaccuracies in the data provided, and also because
the aircraft have been valued "sight unseen". In this case we consider that a
tolerance of +/- 4% may reasonably apply to the aforementioned calculated
values.
Please note that valuations given by Airclaims are valid only as at the
date of issue. Subsequent to that date there may be alterations in the world
aviation market, or in the status and physical condition of the subject aircraft
or other general factors that may affect Airclaims' valuation opinion.
I trust the foregoing is satisfactory and to your requirements.
Yours faithfully,
/s/ Edward Pieniazek
Edward Pieniazek
Director, Consultancy & Information Services
Encl.
Morgan Stanley Aircraft Finance (MSAF)
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AIRCLAIMS LTD.
MSAF -- FLEET ASSESSMENT 30 SEP 1997
ID VAR. MSN REG'N ENG E.VAR MTOW SEATS BUILD* TTAF TCSN
TYPE (ILFC DATA)
- ----- ---- ---- ----- --- ----- ---- ----- ----------- ---- ----
0
1 A300-600R 555 N8888P PW4000 4158 378,530 324 Mar-90 18,243 5,568
2 A310 300 409 HB-IPH PW JT9D 7R4E1 330,750 175 Nov-85 35,463 13,271
3 A310 300 410 HB-IPI PW JT9D 7R4E1 330,750 175 Nov-85 36,950 13,522
4 A310 300 437 OO-SCC PW JT9D 7R4E1 337,300 181 Feb-87 44,314 8,888
5 A320 200 279 G-MONY CFM56 6A3 169,756 180 Feb-92 21,901 8,237
6 A320 200 393 B-HYO IAE V2500 A1 166,447 156 Feb-93 9,934 4,223
7 A320 200 414 B-HYR IAE V2500 A1 166,447 156 Mar-93 9,435 5,340
8 A321 100 597 TC-ONI IAE V2530 A5 183,000 220 May-96 4,822 1,868
9 B737 300 24299 N956WP CFM56 3B2 137,000 138 Nov-88 25,391 13,614
10 B737 300 25161 CS-TIK CFM56 3B2 138,500 132 Feb-92 15,980 9,138
11 B737 300 26295 B-2937 CFM56 3C1 135,000 148 Dec-93 9,795 6,885
12 B737 300 27635 PH-TSZ CFM56 3C1 139,000 149 May-95 8,167 2,989
13 B737 400 24234 N403KW CFM56 3B2 143,500 170 Oct-88 23,558 9,918
14 B737 400 25104 N771AS CFM56 3C1 143,500 140 May-93 15,520 9,370
15 B737 400 25371 N404KW CFM56 3C1 150,000 159 Jan-92 14,736 6,889
16 B737 400 25372 TC-JDI CFM56 3C1 150,000 150 May-92 14,343 7,508
17 B737 500 25165 EI-CDT CFM56 3B1 121,500 117 Apr-93 11,112 10,307
18 B737 300F 23811 N731LF CFM56 3B2 138,500 F Sep-87 25,790 13,705
19 B737 300QC 23788 F-GIXH CFM56 3C1 139,500 126 May-87 24,972 14,340
20 B747 300 24106 PP-VOA GE CF6 80C2 833,000 395 Apr-88 42,306 8,250
21 B757 200 24260 N757GA RR RB211 535E4 250,000 202 Dec-88 31,976 7,842
22 B767 200 24367 EI-CLM RR RB211 535E4-37 250,000 179 Feb-89 29,945 7,908
23 B757 200 26272 N806AM PW2000 2037 230,000 180 Mar-94 12,041 5,366
24 B767 200 23807 VH-RMO GE CF6 80A2 345,000 290 Aug-87 35,523 14,304
25 B767 300(ER) 24798 HL7284 GE CF6 80C2B6F 345,000 249 Oct-80 19,054 11,456
26 B767 300ER 26256 G-UKLH GE CF6 80C2B6F 407,000 327 Apr-93 24,588 3,569
27 B767 300ER 26260 DQ-FJC GE CF6 80C2B6F 407,000 263 Sep-94 13,225 2,683
28 F-70 11564 HA-LMA RR TAY620 15 81,000 75 Dec-95 3,088 2,211
29 F-70 11565 HA-LMB RR TAY620 15 81,000 75 Feb-96 3,044 2,135
30 F-70 11569 HA-LMC RR TAY620 15 81,000 75 Mar-96 2,988 2,070
31 MD-89 83 49822 F-GHEB PW JT8D 219 160,000 159 Dec-88 19,260 11,088
32 MD-80 82 49825 N940AS PW JT8D 219 149,500 135 Mar-89 25,416 16,131
33 MD-80 83 49824 N942OD PW JT8D 219 160,000 130 Mar-88 22,073 16,941
34 ENGINE 704279 GE CF6 80C2B6F (QEC) 1995 8,546 2,372
ID AS AT...OPR 30-SEP-97 30-SEP-97 MAINT
TYPE ADJ. BV BV (HL) ADJ.
- ----- ----------- --------- --------- -----
0
1 30-Apr-97 CHINA AIRLINES $51.15m $49.77m $1.38
2 31-Jul-97 SWISSAIR $23.79m $23.76m $0.03
3 30-Sep-97 SWISSAIR $23.81m $23.76m $0.05
4 13-Nov-97 PASSAREDO $26.97m $25.60m $1.37
5 02-Sep-97 MONARCH $31.36m $30.96m $0.40
6 30-May-97 DRAGONAIR $32.22m $32.27m -$0.05
7 31-Jul-97 DRAGONAIR $32.72m $32.81m -$0.09
8 20-Oct 97 ONUR AIR $41.97m $41.26m $0.71
9 16-Oct-97 WESTERN PACIFIC $22.80m $21.61m $1.19
10 31-Jul-97 TAP AIR PORTUGAL $26.00m $25.98m $0.02
11 05-OCT-97 CHINA HAINAN $28.09m $28.15n -$0.06
12 30-Jun-97 TRANSAVIA $31.28m $30.60m $0.68
13 30-Jun-97 CARNIVAL $22.58m $22.43m $0.15
14 21-Oct-97 ALASKA $28.63m $28.54m $0.09
15 31-Jul-97 CARNIVAL $26.96m $27.26m -$0.30
16 31-May-97 THY $28.22m $26.67m -$0.45
17 15-Oct-97 AER LINGUS $22.04m $22.53m -$0.49
18 28-Aug-97 ILFC (STORED) $22.73m $21.87m $0.86
19 30-Sep-97 L'AEROSPOSTALE $22.65m $22.49m $0.16
20 15-Oct-97 VARIG $65.19m $64.47m $0.72
21 07-Sep-97 GUYANA AIRWAYS $33.60m $33.08m $0.52
22 31-May-97 TRANSAERO $33.53m $33.13m $0.40
23 14-Oct-97 AEROMEXICO $38.15m $38.04m $0.12
24 31-Jul-97 ANSETT/BRITANNIA $35.37m $34.70m $0.67
25 31-May-97 ASIANA $54.93m $54.54m $0.39
26 16-Oct-97 AIR UK $67.13m $66.01m $1.12
27 08-Oct-97 AIR PACIFIC $58.83m $68.25m $0.58
28 07-Sep-97 MALEV $16.82m $16.22m $0.60
29 07-Sep-97 MALEV $16.32m $15.71m $0.61
30 07-Sep-97 MALEV $16.64m $16.01m $0.63
31 17-Nov-97 AIR LIBERTE $16.71m $16.78m -$0.07
32 30-Jun-97 ALASKA $15.87m $16.21m -$0.34
33 17-Oct-97 TWA $16.96m $16.58m $0.38
34 30-Sep-97 KLM $6.16m $5.70m $0.46
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$1,048.21m $1,035.75m
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