Avolon, the aircraft leasing group, has announced a second capital raising of USD650m comprising USD250m of equity and USD400m of debt finance. The company has also agreed terms to acquire 11 new aircraft, under sale and leaseback structures, from four airlines.
The USD250m of additional equity has been raised from Avolon’s existing investors: Cinven, CVC Capital Partners and Oak Hill Capital Partners. A number of other investors have also participated in the equity raising including Oak Hill Advisors. The USD400 million of debt finance was provided by three European institutions – DVB, Nord LB and KfW IPEX-Bank – in separate bilateral transactions.
This additional capital raising brings the total capital raised by Avolon, since launch in May 2010, to in excess of USD2 billion comprising USD1 billion of equity and USD1 billion of debt finance.
The 11 new aircraft Avolon is acquiring under sale and leaseback structures are from four airlines based in Europe, Asia and Australia. Two of the aircraft were delivered new in 2010 and the remainder will deliver in the next twelve months. Acquisitions comprise five Airbus A320s and six Boeing 737-800s with two A320s being leased to Philippine Airlines, three A320s to Indigo Airlines of India, three Boeing 737-800s each to be leased to Air Berlin and Australian carrier VirginBlue.
“We are pleased to announce our second capital raising of USD650 million which brings our total capital raising, for 2010, to over USD2 billion," says Denis Nayden, Avolon Chairman. "The additional equity investment reflects the rapid development of Avolon since launch and the confidence the shareholders have in Avolon’s strategy, management team and business model.
“Since the business was launched in May, 2010, Avolon has delivered on each of its business objectives. These include initial orders for new aircraft with both Boeing and Airbus together with the completion of sale and leaseback and portfolio transactions totalling over 40 aircraft on lease to a globally diverse pool of airlines. We have built a strong team to sustain our growth and deliver on our objectives for 2011 and beyond as we continue to create value for our shareholders.”
