By Kylie Madry

MEXICO CITY Mexican airline Viva Aerobus has signed a memorandum of understanding to purchase 90 Airbus A321neo aircraft, the carrier said on Wednesday, in a deal likely worth several billion dollars.

The announcement confirms Reuters reporting last month that the two were close to a tie-up on an order of that magnitude following talks coinciding with the Paris Airshow.

The companies did not name a price for the aircraft, and Airbus no longer publishes catalog prices. Based on 2018 listing prices, the deal would be worth some $11.7 billion before typical industry discounts.

The agreement brings Viva's order book up to 170 Airbus aircraft, the carrier said in a statement, all part of the A320 family.

The planes will be powered by GTF engines produced by Raytheon's Pratt & Whitney, and Airbus is expected to start delivering the aircraft in 2027, Pratt & Whitney said in a separate statement.

The engines are certified to run on up to 50% sustainable aviation fuel (SAF), a key tool for airlines to reduce carbon emissions. In April, Viva signed an agreement with SAF producer Neste to purchase 1 million liters of the fuel.

Viva said the aircraft order would drive both domestic and international growth plans, taking into account that Mexico is expected to recover a U.S. air safety rating in coming months.

Mexico was downgraded by the U.S. Federal Aviation Administration in May 2021 for lack of compliance with international standards, blocking Mexican carriers from adding new flights to the U.S. and preventing some marketing tie-ups.

Mexican airline Aeromexico has said it has been unable to fly newly delivered planes to the U.S. due to the downgrade, while Viva's low-cost rival Volaris also has a number of route expansions frozen.

Viva said U.S.-Mexico access will see an additional boost on the commercial alliance it signed with U.S. airline Allegiant in December 2021.

(Reporting by Kylie Madry; Additional reporting by Raul Cortes and Tim Hepher; Editing by Bill Berkrot)