May 24, 2024
Business Aviation

AviLease to buy Standard Chartered aviation finance leasing business

AviLease Aircraft Leasing Company, the Riyadh-headquartered aviation financing and leasing company, has agreed to acquire the global aviation finance and leasing business of Standard Chartered, which includes Dublin-based Pembroke Group, in a transaction worth AED13.24 billion ($3.6 billion).

The Saudi aircraft lessor arranged AED7.7 billion ($2.1 billion) of competitive bridge financing commitments from BNP Paribas, Citibank N.A., HSBC Bank Middle East, and MUFG Bank for the transaction.

The sale is expected to close towards the end of 2023.

Global footprint

Standard Chartered’s aviation finance business is a leading global aircraft leasing and financing operation, owning and managing a modern fleet portfolio of over 120 aircraft on lease to more than 30 of the world’s leading airlines.

AviLease and Flynas enter their new partnership in July 2022. Image: Flynas
AviLease and Flynas enter their new partnership in July 2022. Image: Flynas

The transaction includes the sale of 100% shareholding in each of Pembroke Group Limited (Isle of Man), Pembroke Aircraft Leasing Holdings Limited (Ireland) and Pembroke Aircraft Leasing (Tianjin) Limited (China) to AviLease.

The acquisition of Standard Chartered’s aircraft leasing portfolio provides AviLease with operational scale, global diversification, and the possibility to become a top-10 global aircraft lessor.

The company invests in the latest generation Airbus and Boeing aircraft through purchase and lease-back transactions, portfolio trades and direct orders from aircraft manufacturers.

Founded in June 2022, AviLease is wholly owned by the Public Investment Fund, Saudi Arabia’s sovereign wealth fund, and holds a fleet of the latest generation, environmentally friendly aircraft on lease to scores of commercial airlines across the globe.

Large fleet

As part of the purchase, AviLease will acquire a fleet of 100 narrow-body aircraft while becoming a servicer for another 22 aircraft.

On completion of the sale, AviLease will own and manage 167 of the latest technology, fuel-efficient aircraft, consisting of 145 owned valued at circa AED22.0 billion ($6 billion) and 22 driven aircraft valued at circa AED2.94 billion ($800 million) leased to 46 airlines globally.

Fahad Al-Saif, Chairman of AviLease, said: “The Standard Chartered leasing business is an industry-leading platform combined with a team of high-calibre professionals with an outstanding reputation.

“This acquisition will propel AviLease and will, in turn, support Saudi Arabia’s aviation ecosystem on our path to help realise the Saudi Vision 2030’s objective of diversifying the economy and adding high-value employment opportunities for Saudi citizens.”

Edward O’Byrne, CEO of AviLease, said: “This acquisition is a fantastic next step in AviLease’s young existence. We purchase a high-quality portfolio of narrow-body aircraft on lease to top-tier airlines globally.

Big ambitions

“We have the ambition to become a top-10 global aircraft lessor, and this acquisition brings us one step closer,” O’Byrne added.

Simon Cooper, CEO of Corporate, Commercial & Institutional Banking and Europe & Americas at Standard Chartered, said: “We wish AviLease every success with its strategy to develop further the business for continued growth, and delivering on its ambition, to be a significant global player in the aviation leasing sector.

“I want to thank our Standard Chartered Aviation Finance colleagues, whose strong commitment to building an outstanding franchise over more than 15 years has enabled the success of this transaction.”

In July 2022, AviLease signed a leasing agreement with Flynas, Saudi Arabia’s low-cost carrier, wherein the lessor would purchase 12 new Airbus A320neo aircraft to be leased to Flynas.

Featured image: Standard Chartered and AviLease officials at the sale signing ceremony in Riyadh, Saudi Arabia.

    Arnold Pinto

    Arnold Pinto

    Arnold Pinto is an award-winning journalist with wide-ranging Middle East and Asia experience in the tech, aerospace, defence, luxury watchmaking, business, automotive, and fashion verticals. He is passionate about conserving endangered native wildlife globally. Arnold enjoys 4x4 off-roading, camping and exploring global destinations off the beaten track.
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