Avolon Aerospace Leasing Ltd., the private-equity backed aircraft financing company, filed for a $100 million U.S. initial public offering as industry deal-making accelerates.
The figure is a placeholder used to calculate registration fees and may change. Dublin-based Avolon didn’t specify a number of shares to be sold or give a price range in a U.S. regulatory filing yesterday, details that may come closer to the offering.
Avolon’s move follows through on the hiring of JPMorgan Chase & Co. (JPM) and Morgan Stanley (MS) this year to weigh a possible IPO or sale. The company, owned by Oak Hill Capital Partners LP, Cinven Ltd., and CVC Capital Partners Ltd., is the latest jet lessor to explore strategic options amid strong demand for fuel-efficient aircraft.
Chief Executive Officer Domhnal Slattery had signaled his interest in a transaction by saying he was encouraged by acquisitions such as Sumitomo Mitsui Financial Group (8316)’s $7.3 billion purchase of Royal Bank of Scotland Group Plc.’s aviation unit in 2012.
Founded in 2010, Avolon has a portfolio of 202 aircraft worth $4.39 billion and an average age of 2.5 years, according to the prospectus filed yesterday with the U.S. Securities and Exchange Commission. It has committed to buy 87 jetliners, with a list value of about $4.87 billion, for deliveries scheduled through 2021.
The company’s focus is on acquiring “young, modern, fuel-efficient aircraft that we believe will remain in strong demand,” Avolon said. About half of the global jetliner fleet will be under operating leases by 2020, up from 41 percent in 2014, Avolon said, citing a Boeing Co. (BA) forecast.
AerCap Holdings NV (AER) vaulted to the top of the industry as the biggest stand-alone lessor by completing its $7.6 billion purchase of International Lease Finance Corp. from American International Group Inc. last month. Only General Electric Co.’s Gecas unit is larger.
Awas Aviation Capital Ltd. is also exploring strategic options, according to an April 2 report by Airfinance Journal. Other recent transactions involving lessors include the sale of Oaktree Capital Group LLC (OAK)’s Jackson Square Aviation to Mitsubishi UFJ Lease & Finance Co. (8593) for about $1.1 billion.
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