Aviation Finance

Developments

Avolon prices $3 billion senior note offering as part of CIT acquisition
January 20th 2017: Avolon Holdings is issuing $3.0 billion through its Park Aerospace wholly-owned subsidiary. Both $1.75 billion 5.25 per cent senior notes, due 2022, and $1.25 million of 5.5 per cent senior notes due 2024 are being offered at par. Avolon will fully and unconditionally guarantee the notes and the offer will close 'on or about' February 3rd.

CDB Aviation Lease Finance appoints top management team, with Rob Murphy as COO, and Pat Hannigan as CCO
January 16th 2017: China Development Bank-owned CDB Aviation Lease Finance (CDBALF) today announced the appointment of former Freshfield's global aviation and asset finance team leader Rob Murphy as COO and its General Counsel and Avolon's former head of EMEA Pat Hannigan as Chief Commercial Officer. Former GECAS executive John Cunningham has been appointed SVP Asia Pacific. CEO Peter Chang said the team will be charged with expanding CDBALF's "market reach beyond China and shifting the company's current approach to a more western, customer-centric focus serving all global markets".

 

Perspectives

Aircraft Valuations

IBA's Phil Seymour on the business of aircraft appraisals and his response to calls from the leasing industry for a rethink of how appraisers work.

SMBC Aviation Capital's Michael Weiss on selling aircraft
Aergo's plan for recessionary times
GECAS' Sean Flannery on the aircraft leasing market
Astro's Johnny Lau on Chinese lessors' global ambitions

See the Aviation Finance Perspectives Series here.

Analysis

SpiceJet's 737 MAX order indicates this could be the year of the MAX
January 13th 2017: Indian low cost carrier SpiceJet has announced a deal with Boeing for up to 205 Boeing 737 MAX 8s. 2017 is a crucially important year for the MAX with Boeing keen to avoid any teething problems as the re-engined 737 enters into service with Norwegian in May. The order from SpiceJet adds further momentum to the programme, which has has already beaten test flight targets during 2016.

The January 12th edition of Aviation Finance is published
January 12th 2017: In the latest issue of Aviation Finance: IBA's Phil Seymour gives his response to Avolon's Dick Forsberg's white paper on aircraft valuations and valuers; Moody's Mark Wasden gives insight into his agency's outlook on the aircraft leasing sector in 2017; Floreat outline its first foray into the aircraft-backed ABS market; Will 2017 be the Year of the Max?; 10 key questions for aircraft financing stakeholders at the beginning of 2017; GECAS reveals strategy to share in growth in the sector while not growing its balance sheet; Avolon receives credit ratings, adds three independent directors to its board; AA kicks off the 2017 EETC market with a $1 billion issuance.

Peter Chang to lead CDB Aviation Lease Finance
January 12th 2017: Industry veteran Peter Chang, who has been appointed President and CEO, will lead CDB Aviation Lease Finance into the next phase of growth as the lessor aims to build a world-class, industry-leading management team and expand its focus beyond China.

 

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GECAS in talks with potential co-investors in 'structured vehicle'
January 10th 2017: GECAS is planning to launch a new vehicle, possibly some kind of 'sidecar,' with the aim of continuing to participate in the growth of the aircraft leasing sector without increasing the size of its balance sheet. The lessor is is considering interest for a potential co-investor in regards to a structured vehicle with limited scope, which could support our own growth opportunities.'

The December 15th edition of Aviation Finance is published
December 15th 2016: In the latest issue of Aviation Finance: FPG Amentum's Mitchel Simpson on NORD/LB and the lessor's business strategy; Moody's speaks with Aviation Finance on its sector outlook for 2017; Goshawk's pioneering move in German private funding market has opened the doors for more aircraft lessors; Wide ocean, narrowbody - North Atlantic air travel market being shaken up by new technology narrowbodies; Boeing's financing outlook for 2017; Abu Dhabi Global Market makes its regime more attractive for aircraft financing.

The December 1st edition of Aviation Finance is published
December 1st 2016: In the latest issue of Aviation Finance: The impact on aircraft financing if Dodd-Frank is repealed by the incoming US administration; SMBC Aviation Capital's Michael Weiss on aircraft investing and aircraft investors; Another nail in the coffin of VLAs? OEM orders - past peak or just a short pause? AVi8 Air Capital's strategy; The year ahead for aircraft investors.

 

Analysis

KBRA rates Labrador Aviation Finance Limited
November 23rd: Kroll Bond Rating Agency (KBRA) has assigned preliminary ratings to two classes of notes issued by Labrador Aviation Finance Limited. The aircraft ABS will be backed by a portfolio of 20 aircraft, currently owned by affiliates of GECAS, which will be purchased through the proceeds from the sale of the notes. The aircraft are on lease to 16 airlines in 15 countries with an initial total value of approximately $928.0 million. GECAS will act as the servicer for the transaction.


The November 17th edition of Aviation Finance is published
November 17th 2016: In the latest issue of Aviation Finance: Cyclical moments?: After the US Presidential election; AERGO Capital chiefs Fred Browne and Gerry Power talk in detail to Aviation Finance about their business model, and where we are at in the cycle. Their views provide considerable food for thought; Warren Buffett buys 4 airline stocks, committing +1% of Berkshire Hathaway's portfolio - is this a cyclical moment in aviation finance?


AeroTurbine downsizing, older aircraft sales hit AerCap Q3 earnings, but firm authorises another $250m stock buyback
November 8th 2016: Releasing Q3 earnings today, Aercap reported net income of $225.6 million, down 23.2% on the $293.9 million of the same period in 2015. It reported earnings per share (diluted) of $1.22, compared with $1.48 for the same period in 2015, down 17.6%. The reduced figures reflected sales of older aircraft, a lower net gain on assets, and a corresponding decline in average lease rents, which were 6.6% lower than in Q3 2015.

The November 3rd edition of Aviation Finance is published
November 3rd 2016: In the latest issue of Aviation Finance: Basel IV proposals and the challenge they pose to the future health of the aircraft financing markets; End of lease planning: survey shows lessors unimpressed by lessee preparedness; ALC's prepares its first ABS, Apollo prices ABS; Analysis: the rise of Asian leasing; Aircastle results; European short haul market; Willis moves quickly to acquire TES; Avolon's CIT acquisition funding.

Aircastle's post-Halloween surprise spooks investors
November 3rd 2016: The extent to which impairments can affect an otherwise good performance - and scare investors in the process - is reflected in the market reaction to Aircastle's Q3 results, writes John Stanley. In its release on November 1st the company highlighted that its total revenues in Q3 were $194.7 million, total lease rental and finance and sales-type lease revenues of $187.3 million, while net income was $27.4 million, or $0.35 per share (and adjusted net income of $29.7 million, or $0.38 per share) compared to a net loss of $14.0 million, or $0.17 per share in the same three months of 2015.

Avolon sees strong demand from banks to provide debt for CIT transaction
November 3rd 2016: Avolon has placed 35% of the US$8.5 billion debt financing facilities, led by Morgan Stanley & Co. LLC (Morgan Stanley) and UBS Investment Bank (UBS), for the acquisition of the aircraft leasing business of CIT Group Inc.