Saudi wealth fund-owned aircraft lessor raises $1.1bn to expand fleet
Aiming to procure 45 aircraft by the end of 2023, AviLease, an aircraft financing and leasing company owned by the Public Investment Fund, has garnered $1.1 billion in its inaugural financing.
The unsecured five-year facility will be predominantly used to acquire additional aircraft, thereby enhancing the company’s premier portfolio.
“We are very pleased to announce the successful closing of our debut $1.1 billion unsecured term financing facility, supported by a syndicate of banking partners locally, regionally and across the world,” AviLease CEO Edward O’Bryne said in a statement.
The financing is split into two segments — a conventional funding section of $850 million and an imminent Shariah-compliant tranche of $250 million.
The financing request spurred substantial interest locally, regionally, and internationally, with an oversubscription rate of 3.3 times, according to the press release.
“We thank the lenders for their support and long-term confidence in AviLease.
“The quality and breadth of demand for the debut funding far exceeded our expectations, and we are thankful to our banking partners and advisers for their support in achieving this outcome,” O’Bryne commented.
With plans to augment its fleet to roughly 300 aircraft by 2030, the company is targeting to position itself among the world’s leading aircraft leasing firms. It has already acquired or committed to acquiring 45 aircraft by the end of 2023, amounting to a book value of $2.4 billion.
“It is crucial for us to work with a wide variety of international financial partners with strong balance sheets, who can provide incremental funding to support our growth objectives,” O’Bryne said. Citibank, Riyad Bank, First Abu Dhabi Bank, Gulf International Bank and Saudi Awwal Bank functioned as the mandated lead arrangers for the transaction. Meanwhile, Banque Saudi Fransi, Saudi Investment Bank, Abu Dhabi Commercial Bank and HSBC Middle East served as mandated lead arrangers for the conventional tranche. Dubai Islamic Bank, Al Rajhi Bank, Bank AlJazira, and Saudi National Bank will serve as mandated lead arrangers for the Shariah-compliant tranche. Moreover, Citibank functioned as the financial adviser for AviLease, with Allen & Overy acting as its counsel, while Clifford Chance provided advisory services to the lenders. Headquartered in Riyadh, AviLease invests in the latest generation aircraft via purchase and lease-back transactions, portfolio trades and direct orders from aircraft manufacturers.