General Electric to Save Irish Aircraft Firm : Acquisitions: The $1.3-billion deal with GPA Group will nearly double aircraft lessor GE’s already dominant fleet.

General Electric Co., already the world’s largest aircraft leasing company, made a move to nearly double its fleet Thursday by agreeing to rescue Ireland’s GPA Group in a deal valued at more than $1.3 billion.

GE Capital Corp., GE’s huge financial subsidiary, said it will take over management of the 470-plane leasing business of GPA, which grew rapidly during the 1980s but plunged into financial crisis last year. GE Capital already leases about 500 passenger jets.

The pact, which the companies negotiated over several months, also calls for GE Capital to buy 45 new jets from GPA for $1.35 billion, and for GE Capital to be given an option to buy a controlling interest in GPA for as much as $165 million.

In tandem with the GE Capital deal, GPA said it is going ahead with its plans to slash its orders of new passenger jets by 76% to save cash. That means it now plans to buy 57 planes worth $3.6 billion instead of 242 valued at $11.3 billion.

The cutback involves planes made mostly by Boeing Co. and the European consortium Airbus Industrie. GPA’s current order for 13 of McDonnell Douglas’ MD-11 wide-body commercial jets, which are made in Long Beach, still stands, said McDonnell spokesman John Thom.

However, Thom said McDonnell is suing GPA for allegedly failing to take delivery of previously ordered McDonnell jets. He declined to elaborate. GPA acknowledged the litigation but provided no details.

Boeing confirmed that its GPA orders have been cut but declined to discuss the rest of GPA’s pullback. Airbus spokesman David Venz declined to comment.

While most aircraft lessors are little known, their business has become key for the world’s airlines. Leasing enables the air carriers to rapidly change the makeup of their fleets without having to make multimillion-dollar commitments to buy passenger jets years before the planes are built.

GE Capital’s move is coming amid a severe slump in jet demand, owing to financial problems at many of the world’s airlines. But GE Capital spokesman Tom Lamb, noting that his company’s existing fleet is 95% leased, said that “we are confident” of succeeding with GPA.

Also, GE Capital would be operating GPA without having to assume any of GPA’s $5-billion debt load.

The GPA deal is another major expansion for GE Capital, a Stamford, Conn.-based company that is one of the largest and most profitable forces in GE’s vast family of businesses. (GE is also a leading maker of jet engines.) With assets totaling $105 billion, GE Capital also has interests in corporate finance, insurance and consumer lending.

GPA, founded in 1975 by former Aer Lingus executive Tony Ryan, quickly became one of the largest aircraft lessors during the 1980s. One of its principal rivals besides GE is Century City-based International Lease Finance Corp., a unit of American International Group Inc.

Based in Shannon, Ireland, GPA ran into trouble by mid-1992. As the aviation slump worsened, GPA’s cash dwindled at the same time the firm had $12 billion of airplanes on order. GPA hoped to ease its burden with a stock offering last year, but the sale was scratched.

Under the GE Capital deal, Ryan is stepping down as GPA’s head but will keep an executive post with a new GE unit, to be called GE Capital Aviation Services, that will oversee the aircraft leasing operations. The deal is subject to approval by GPA’s stockholders at a meeting Oct. 18.