Bo­hai to buy jet leas­ing firm in US

Com­pany will be world’s third largest air­craft leaser fol­low­ing this and spate of re­cent deals

China Daily (Hong Kong) - - BUSINESS - By ZHU WEN­QIAN zhuwen­qian@ chi­

Bo­hai Cap­i­tal Hold­ing Co Ltd, a Chi­nese fi­nance leas­ing com­pany, plans to fully ac­quire US com­mer­cial jet leas­ing firm C2 Avi­a­tion Cap­i­tal for $10 bil­lion in cash, ac­cord­ing to a state­ment from Bo­hai Cap­i­tal.

Shares of Shen­zhen-listed Bo­hai Cap­i­tal re­sumed trad­ing on Thurs­day, and the stock surged to the 10 per­cent daily li mit and closed at 7.9 yuan ($1.14). The stock’s trad­ing has been sus­pended since Septem­ber. It is re­ported that the deal is ex­pected to close in early 2017.

New York-based C2, owned by US com­mer­cial lender CIT Group Inc’s air­craft-leas­ing unit, is one of the lead­ing com­pa­nies that pro­vides com­mer­cial air­craft leas­ing ser­vices to air­lines.

Since 1999, the com­pany has pur­chased air­planes di­rectly from air­craft man­u­fac­tur­ers.

As of June 30, C2 owned 307 air­craft and had orders for 132 jets. Its net as­sets are about $6.9 bil­lion. Last year, C2 achieved sales rev­enue of nearly $1.2 bil­lion, and net profit of $385 mil­lion, ac­cord­ing to the com­pany’s earn­ings re­port.

The lat­est deal would add to a string of over­seas ac­qui­si­tions by pri­vate­ly­owned Bo­hai Cap­i­tal, af­ter its ac­qui­si­tions of air­craftleas­ing com­pany Avolon Hold­ings, and the air­plane bil­lion

the cost of Bo­hai Cap­i­tal Hold­ing Co’s ac­qui­si­tion of C2 Avi­a­tion Cap­i­tal

as­sets of GE Cap­i­tal Avi­a­tion Ser­vices. The ac­qui­si­tion is also ex­pected to en­hance the in­ter­na­tional com­pet­i­tive­ness of Bo­hai Cap­i­tal in the global air­craft l eas­ing mar­ket and raise its global mar­ket share, the com­pany said.

Af­ter the trans­ac­tion, Bo­hai Cap­i­tal is set to be­come t he t hird-largest air­craft leas­ing com­pany world­wide in terms of fleet size, fol­low­ing GE Cap­i­tal Avi­a­tion Ser­vices and AerCap Hold­ings N.V. Or­di­nary S, ac­cord­ing to the statis­tics of avi­a­tion in­for­ma­tion provider Flight­global.

Mean­while, the to­tal num­ber of cus­tomers of Bo­hai Cap­i­tal is ex­pected to nearly dou­ble to more than 150, with a more bal­anced dis­tri­bu­tion among Asia-Pa­cific, Europe and North Amer­ica. The com­pany will also strengthen its abil­ity to re­sist the risk of re­gional eco­nomic cy­cle fluc­tu­a­tions.

Bo­hai Cap­i­tal said af­ter the com­ple­tion of the trans­ac­tion the com­pany will ex­pand its mar­ket share and raise the scale of its busi­ness. It is ex­pected to fur­ther im­prove its com­pet­i­tive­ness in the sec­tor, in­crease its prof­itabil­ity, and bring pos­i­tive re­turns to the share­hold­ers.

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