Avolon prices USD 3.0bn senior notes offering

Avolon Holdings Limited has priced the private offering by its wholly owned subsidiary, Park Aerospace Holdings Limited, of USD 1,750m aggregate principal amount of 5.25% Senior Notes due 2022, at par, and USD 1,250m aggregate principal amount of 5.50% Senior Notes due 2024, at par, the company said.

The notes will be fully and unconditionally guaranteed by Avolon. The offering is expected to close on or about February 3, 2017, subject to customary closing conditions.

Avolon intends to use the net proceeds from the offering, together with cash on hand, new equity contributed by its indirect parent company, Bohai Capital Holding Co., Ltd. , and USD 5,500m of borrowings under a new senior secured term loan facility, to finance the previously announced acquisition of C2 Aviation Capital, LLC, the commercial aircraft leasing business of CIT Group Inc., and to pay related fees and expenses. Upon consummation of the acquisition, the notes will be fully and unconditionally guaranteed by certain subsidiaries of C2.

The proceeds from the offering will initially be deposited into an escrow account for the benefit of the holders of the notes. If the acquisition is not consummated within the time periods required under the escrow agreement and, in any event, on or prior to October 6, 2017, the notes will be subject to special mandatory redemption at a redemption price equal to 100% of the initial issue price of the notes, plus accrued and unpaid interest to the redemption date. The acquisition is subject to customary closing conditions and certain required regulatory approvals, as well as Bohai shareholder approval.

Avolon Holdings Limited is an international aircraft leasing company.