Avolon (NYSE: AVOL) said it has entered into an agreement with Bohai Leasing Co., Ltd. (SZSE: 000415) granting Bohai exclusivity to negotiate with Avolon until September 7, 2015 with respect to the possible acquisition of 100 percent of the issued and outstanding common shares of Avolon at a price of USD32 per share.
During the period, Bohai and Avolon will endeavour to negotiate definitive agreements on terms previously discussed and accepted by the parties. Bohai´s offer is subject to completion of satisfactory and customary due diligence.
Bohai will make a good faith deposit of USD50 million into an escrow account, which amount will be in addition to the USD25 million currently held in escrow in connection with the cash tender offer made by Bohai on July 31, 2015, for an aggregate deposit of USD75 million. Avolon will be entitled to receive the USD75 million deposit in certain circumstances, including if Avolon is willing to execute definitive documents in connection with the transaction and Bohai is unable or unwilling to do so.
Upon execution of definitive documents in connection with the Transaction, the USD75 million deposit will be increased by Bohai to USD250 million, payable to Avolon in the event the Transaction is not consummated under certain circumstances.
Avolon is an international aircraft leasing company, headquartered in Ireland, with regional offices in China, Dubai, Singapore and the United States. Avolon provides aircraft leasing and lease management services.
Bohai Leasing is a Chinese public company listed on the Shenzhen Stock Exchange, and is the only listed leasing company in China.