Saudi jet lessor AviLease secures $1.1bn to expand fleet

Saudi Arabia’s Public Investment Fund arm for financing of aircraft has secured $1.1 billion in its inaugural funding round.

Riyadh-based Aircraft Leasing Company (AviLease) will use the unsecured five-year facility for general corporate purposes, including growing its fleet.

“We have successfully closed our debut $1.1 billion unsecured term financing facility, supported by a syndicate of banking partners locally, regionally and across the world,” AviLease CEO Edward O’Bryne said in a statement.

The financing is split into two parts: a conventional funding tranche of $850 million and a Shariah-compliant part of $250 million.   

The order book garnered substantial interest globally and was oversubscribed 3.3 times, the company said.

“The quality and breadth of demand for the debut funding far exceeded our expectations,” O’Bryne added.  

AviLease, launched in June last year, plans to increase its fleet to 300 aircraft by 2030 and has already acquired or committed to acquiring 45 aircraft by year-end at a book value of $2.4 billion.  

Citibank, Riyad Bank, First Abu Dhabi Bank, Gulf International Bank and Saudi Awwal Bank were lead arrangers for the transaction.   

Last week, AviLease purchased 13 aircraft, including seven Airbus A320neos, two A330neos and a Boeing 737 Max 8, from Ireland-based leasing firm Avolon to bolster its growth plans.

The jet lessor is competing to buy Standard Chartered Plc’s aviation finance business, Bloomberg reported earlier, adding the jet lessor is among several firms shortlisted for the second bidding round for the unit.

In July 2022, the PIF subsidiary signed its first leasing agreement with Saudi airline Flynas for purchasing 12 new A320neo aircraft and leasing them to the local low-cost airline.