Royal Bank of Scotland Group Plc (RBS), Britain’s largest government-owned lender, received the highest bid for its aircraft-leasing division from China Development Bank Corp., according to a person with knowledge of the process.
China Development Bank, which is owned by the Chinese government, is so far leading the race to acquire the asset, said the person, who declined to be identified because the discussions aren’t public. Sumitomo Mitsui Financial Group Inc. (8316), Japan’s second-biggest bank by market value, and Wells Fargo & Co. (WFC), also submitted offers, according to people familiar with the sale.
If RBS succeeds in selling the aviation unit for $8 billion, the top end of its price expectation, it would be the lender’s largest disposal since the 2008 financial crisis. The Edinburgh-based bank has sold or wound down more than 150 billion pounds ($233 billion) of assets since 2009 after receiving a government bailout the year before.
While an agreement on the sale of the aircraft-leasing unit isn’t finalized, a decision may come before the end of the year, two people with knowledge of the process said.
Calls to China Development Bank’s office in Beijing weren’t answered outside normal business hours.
RBS Aviation Capital is one of the biggest plane lessors after General Electric Co. (GE)’s Gecas and AIG’s International Lease Finance Corp.
Lessors buy planes and then lease them to airlines for monthly fees, seeking to profit from the residual value by selling aircraft after about 15 years.
RBS is advising itself, alongside Goldman Sachs Group Inc. (GS)
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