Saudi PIF’s AviLease to acquire StanChart’s aircraft leasing business

Image courtesy: Mustafa Yalcin/ Getty Images

AviLease, owned by Saudi Arabia’s Public Investment Fund, has agreed to acquire Standard Chartered’s aviation finance business for $3.6bn. The business includes Dublin-based Pembroke Group.

The Saudi Arabian jet lessor will acquire a portfolio of 100 narrowbody aircraft and become a servicer for another 22 jets. The combined platform will own and manage 167 aircraft, consisting of 145 owned valued at circa $6bn and 22 managed aircraft valued at circa $800m leased to 46 airlines globally.

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

The landmark transaction is expected to accelerate the company’s growth plans to become a top-10 global lessor by 2030.

AviLease Acquires Standard Chartered Aircraft Leasing Platform.https://t.co/j4VpheBryo#SPAGOV pic.twitter.com/6MklEqG9Zy

— SPAENG (@Spa_Eng) August 28, 2023

The Riyadh-based lessor said the transaction is expected to close in Q4 2023. The company secured $2.1bn in bridge financing commitments from BNP Paribas, Citibank, HSBC Bank Middle East and MUFG Bank as part of the deal.

“The acquisition will bring together two strategically complementary businesses, providing AviLease scale, global diversification and the opportunity to leverage Standard Chartered’s best-in-class team and operating capabilities,” the jet lessor said in a statement.

AviLease’s growing portfolio

Founded in June 2022, AviLease is part of Saudi Arabia’s push to diversify its economy and the company is led by Ted O’Byrne, who previously oversaw Carlyle Group’s aviation arm. Recently, the kingdom unveiled a new national airline Riyadh Air, and plans to develop one of the world’s biggest airports in its capital, Riyadh – King Salman International Airport.

The company secured a $1.1bn unsecured five-year loan for general corporate use, including buying more planes in June. In May, it acquired 13 aircraft from Avolon, growing its fleet to 45 planes with a $2.4bn book value. It aims to have 300 aircraft by 2030.

Last July, AviLease signed its first leasing agreement with Flynas for 12 new Airbus A320neo aircraft. The company also signed a sale and leaseback deal with Saudi national carrier SAUDIA that will see 20 Airbus A320neo aircraft delivered to low-cost carrier flyadeal. Keywords: AviLease, Saudi Arabia, Standard Chartered

Read: Dubai Aerospace Enterprise to acquire 64 Boeing 737 MAX aircraft