Lessors’ IPO frenzy; Delta issues RFP

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By TESTCustomwebLP TESTCustomwebLP April 4, 2014 20:12

Lessors’ IPO frenzy; Delta issues RFP

Speaking at a US aviation conference, one banker predicted there could be four or more aircraft lessors looking to go public over the next two years. Back in November 2013, Avolon’s chief executive officer stated publically he would attempt to sell the leasing company this year, with an IPO being mooted as a potential option. The IPO option was given further support whenBloomberg reported on April 4 that the lessor had hired JPMorgan and Morgan Stanley to work on a possible sale or IPO. Terra Firm, which owns Dublin-based lessor AWAS, has also been reported by Reuters to have hired Goldman Sachs and Deutsche Bank to explore options for the sale of the aircraft lessor or an IPO. Many in the industry expect both Avolon and AWAS to favour an IPO since stock valuations are climbing, with aircraft leasing stock enjoying 1.3 times book value at this moment in time. Indeed, most recently it has been revealed by IFR that GE Capital Aviation is seeking to raise $700 million in an IPO listing in Hong Kong during the second quarter of this year. Citigroup is leading that deal. China Aircraft Leasing is also seeking to launch a US$200 million Hong Kong IPO at the same time as GECAS. The deal is being worked on by CICC, China Everbright International and CCB International.

With the industry continuing along its consolidation path, launching IPOs will enable these companies to use stock as currency for purchasing rival leasing companies, much in the same vein as AerCap has done with its purchase of ILFC.

Meanwhile, Delta Air Lines has issued an RFP for up to 50 widebodies aircraft to replace its 747-400s and 767-300ERs.  The airline is said to be considering the A350-900, A350-1000, A330-200, A330-300, 777-300ER and the 787.

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By TESTCustomwebLP TESTCustomwebLP April 4, 2014 20:12
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