Fly Leasing contracted to sell portfolio of Airbus A320s and Boeing 737s

New York-listed aircraft finance business anticipates sales will generate $125m of cash

 

Fly Leasing, the aircraft finance business led by former Aer Lingus chairman Colm Barrington, has been contracted to sell a portfolio of 12 aircraft, comprised of Airbus A320s and Boeing 737s.

“These sales are at an aggregate gain to book value, build free cash, reduce leverage, manage lessee concentration and lower the average age of Fly’s fleet,” said Mr Barrington.

He also noted the New York-listed company, with offices in the US and the Republic, had a committed pipeline of 21 new A320neo family aircraft that begin delivering later this year and which had the capacity to add over $2 billion of assets to its fleet.

Fly said it anticipated the sales, which are likely to be completed in the third quarter, would generate in excess of $125 million of cash after repaying debt related to the aircraft and satisfying other transaction expenses.

Following the sales, Fly’s fleet will comprise 86 aircraft with a weighted average age of approximately seven years and on lease to 39 airlines in 21 countries.

Separately Dublin-based aircraft lessor Avolon, who recently raised $2.5 billion through a bond issue, said its owned and managed fleet of aircraft totalled 530 at the end of the second quarter.

Marginally down

While this was marginally down on last year, the company said it had orders and commitments for a further 393 new technology aircraft.

Last month the lessor signed a deal for 140 engines valued at $2 billion (€1.78 billion) at list prices to power part of its Airbus A320 neo portfolio.

In a trading update on Monday, Avolon said it executed a total of 24 lease transactions in the quarter comprising new aircraft leases, follow-on leases and lease extensions.

It also delivered a total of 15 new aircraft to 10 customers and transitioned 11 aircraft to follow-on lessees.

The company included the raising of $2.5 billion in funding, upsized from an initial target size of $1.8 billion due to significant investor demand, among its main financial highlights for the quarter. It also noted recent credit rating upgrades by Fitch, Moody’s and S&P.