Avolon Holdings Ltd., the jet lessor whose private-equity backers include Oak Hill Capital Partners, surged the most ever after saying it’s considering two nonbinding takeover offers.
China’s Bohai Leasing Co. proposed a buyout at $31 a share following a $30 bid from an undisclosed, independent third party, Dublin-based Avolon said Friday. Bohai’s offer was 25 percent more than Avolon’s closing price in New York on Thursday, when the company’s market value was $2.01 billion.
“We think Avolon is willing to sell the company after a proper bidding process and would not be surprised if there are additional offers,” Helane Becker, a Cowen & Co. analyst, said in a note to investors.
The jockeying began with Bohai submitting a plan for 20 percent of the company at $26 a share, Avolon said. That was followed by the non-binding offer at $30, which triggered a required notice to Bohai, Avolon said. Wulumuqi, China-based Bohai then countered with $31.
“Avolon’s Board of Directors has not accepted or rejected either offer,” according to a statement. The company “has authorized its financial advisers to continue negotiations with both offerers regarding their respective offers.”
Telephone calls to Bohai’s Beijing office went unanswered after regular business hours on Friday. Avolon isn’t commenting beyond the statement, said Jonathan Neilan, a spokesman for the company at FTI Consulting.
Avolon rose 16 percent to $28.73 at the close in New York, the biggest jump since the company’s December initial public offering. The shares have now climbed 44 percent since trading began.
Founded in 2010, Avolon now has more than 260 planes delivered or on order, and the fleet’s average age of 2.6 years is the youngest among major lessors, according to a company fact sheet. Oak Hill is the third-largest shareholder, based on data compiled by Bloomberg, after fellow private-equity firms Cinven Ltd. and CVC Capital Partners.
The IPO in December followed Avolon’s rebuff days earlier of an acquisition offer from a unit of Chinese planemaker Aviation Industry Corp. of China.