Lion completes sale-leaseback; GoAir plans IPO

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By admin October 29, 2015 21:15

Lion completes sale-leaseback; GoAir plans IPO

Lion Air has completed the sale and leaseback of six 737-900ERs to Stellar Aircraft Leasing, a joint venture company between DVB’s Deucalion Aviation Funds and Magnetar Capital. All six aircraft will be managed by DVB Bank. The aircraft entered service in 2009, and will be leased back to Lion Air for an average term of six years.

The transaction, which is rumoured to be around $200 million, was structured through the airline’s Singapore-based leasing affiliate, Transportation Partners (TP).

Stephan Sayre, Managing Director at DVB said that this deal represents the bank’s “first equity position in the -900ER variant, an aircraft type where we remain optimistic on its residual value characteristics”.

John Duffy, Chief Operating Officer at Transportation Partners, described the 737-900ER as the “workhorse that helped Lion Air achieve more than 50% market share in the world’s fourth largest country”, he added, however, that since Lion is an operator of over fifty -900ERs, “there is also a need to manage its residual position, and we shall continue to work with trusted partners such as DVB and Deucalion to deliver fleet solutions for all five airlines in the Lion Group”.

Market sources indicate that Transportation Partners is working on closing similar transactions on 737-900ERs, which are popular with big US carriers such as Alaska Airlines, Delta Air Lines and United. TP is also rumoured to be working on sale-leaseback deals for up to a dozen ATR72 aircraft of varying vintages. Even though ATR72s are not widely used in the US, these deals are reported to have attracted a number of investor groups based in the US.

Meanwhile, TP has hired Ho Bee Leng as its new Financial Controller who was previously a director at KPMG with responsibility for the IPO department for the Asia Listing Group. With her background in IPO valuations, it can be assumed that TP is gearing up to list one or  more of its five airlines, one leasing affiliate in Singapore and/or its fast-growing MRO located on Batam island in Indonesia. Although all of these seven businesses are currently in private ownership, the company has hinted that it would be interesting in launching IPOs for certain businesses if it makes sense from a timing point-of-view. Watch this space.

In India, GoAir, which is part of the Wadia Group, is reported to be considering an initial public offering (IPO) to raise up to $150 million. The unconfirmed reports suggest the airline is already assessing bankers for the proposed issuance but it is not clear if they would favour selling new shares or existing shareholders will reduce their stakes in the planned public offering.

admin
By admin October 29, 2015 21:15