Category Archives: ALC

Air Lease Corporation to lease two Boeing 737-800s to Siam Air

Siam Air (Siam Air Transport) (Bangkok-Don Mueang Airport) is becoming a new Boeing 737-800 operator.

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Air Lease Corporation (ALC) (Los Angeles) announced lease agreements with Siam Air Transport (Thailand) for two used Boeing 737-800 aircraft. These aircraft will be delivered in the fourth quarter of 2015.

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Siam Air was founded in 2013 and commenced low-fare operations in October 2014.

Copyright Photo: Robbie Shaw/AirlinersGallery.com. Siam Air currently operates two Boeing 737-300s to three destinations in Hong Kong and China. The 737-300s will now be replaced with the newer 737s. Boeing 737-3J6 HS-BRU (msn 25893) arrives in Hong Kong.

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Oman Air to lease 14 aircraft from ALC including a new Boeing 787-9

Oman Air (Muscat) and Air Lease Corporation (Los Angeles) have announced long term lease agreements for 14 jet aircraft. The lease agreements cover three new Boeing 737-800s, seven new Boeing 737 MAX 8s, and one new Boeing 787-9, all from ALC’s order book with Boeing. This transaction also includes one used Boeing 737-700 (msn 33103) and two used Boeing 737-800 aircraft (msns 33104 and 34242). The deliveries are scheduled to begin in 2015 and continue through to 2019.

Oman Air’s Chief Financial Officer, Japeen Shah, said, “We are very pleased to sign these agreements with Air Lease Corporation. They enable Oman Air to continue its ambitious fleet and network expansion program, and deliver even greater choice and convenience for our customers. Our expansion plan will see Oman Air’s fleet expand to 57 aircraft by 2018, and to 70 aircraft by 2020. This agreement represents a significant step towards achieving our strategic aims. Furthermore, Air Lease Corporation is at the forefront of the aircraft leasing industry and shares Oman Air’s commitment to realising excellence in all aspects of its work. We look forward to a fruitful partnership.”

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Oman Air’s increased fleet size is enabling it to offer even more exciting destinations within its global network. Over recent months, new services have been launched to Manila, Jakarta, Goa and Singapore. Further new services will be announced closer to the time of their launch, and are expected to include, amongst others, destinations in Bangladesh and China.

Copyright Photo: Paul Denton/AirlinersGallery.com. Boeing 737-8Q8 WL A40-BN (msn 30652) arrives in Dubai.

Oman Air aircraft slide show: AG Airline Slide Show

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AeroMexico to lease one Boeing 787-9 from ALC

Air Lease Corporation (Los Angeles) has announced a long term lease agreement with AeroMexico (Mexico City) for one new Boeing 787-9 aircraft. This aircraft is from ALC’s order book with Boeing and is scheduled for delivery in fall 2016.

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Copyright Photo: SPA/AirlinersGallery.com. AeroMexico will take delivery of the first stretched Boeing 787-9 Dreamliner in 2016 and the new type will replace the existing and aging two Boeing 767-300 ERs. The new 787-9s will operate along with the current smaller 787-8 Dreamliners. The pictured 787-8 N964AM (msn 35307) lands in London (Heathrow).

AeroMexico aircraft slide show: AG Airline Slide Show

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ALC firms up its order for 55 Airbus aircraft

Air Lease A330-900neo (Airbus)(LRW)

Air Lease Corporation (ALC) (Los Angeles), the aircraft leasing company, has firmed up its order for 55 Airbus aircraft, comprising 25 A330-900neo (above) and 30 A321LR (below) aircraft.

ALC was first to sign up for the newest member of Airbus’ market leading widebody family, the A330neo, announcing a commitment for 25 A330-900neo during the launch at the 2014 Farnborough International Airshow. ALC was also the first to commit to the A321LR, the newest variant of the A321neo, after signing a Memorandum of Understanding (MOU) for 30 at the launch in January 2015, increasing its commitment made for 60 A321neo at the 2014 Farnborough Airshow to 90 firm A321neo aircraft.

The A321LR, the latest member of the market leading A320neo Family, will be able to fly longer routes of up to 4,000 nm. The A321LR will provide additional flexibility as it will have the longest range of any single aisle airliner, “making it ideally suited to trans-Atlantic routes and enable airlines to tap into new long haul markets which were not previously accessible with current single aisle aircraft. With 206 passengers in a comfortable two-class layout, the A321LR offers the possibility for each passenger to carry up to three bags. First deliveries will start in 2019.” according to Airbus.

Images: Airbus.

Air Lease A321LR (Airbus)(LRW)

Sunwing Airlines to lease four Boeing 737 MAX 8 aircraft from ALC

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Air Lease Corporation (Los Angeles) has issued this statement:

Air Lease Corporation has announced long term lease agreements with Sunwing Airlines (Toronto) covering two new Boeing 737-800 aircraft and four new Boeing 737 MAX 8 aircraft. These aircraft, all from ALC’s order book, are scheduled to deliver over a four year period commencing in 2016.

President of Sunwing Airlines, Mark Williams, commented, “The acquisition of our new Boeing 737-800 and 737 MAX 8 aircraft is an integral part of our overall expansion plan across an increasing number of both Canadian and U.S. gateways. This year we will be operating flights out of 45 Canadian and U.S. local airports to over 40 different destinations across North and South America, and the Caribbean. As we continue to grow, having aircraft that will enable us to offer a reliable, cost-effective and environmentally-conscious service is paramount. So we are delighted to be able to include the new 737 MAX 8 in our fleet for the first time.”

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Sunwing Airlines aircraft slide show:

Blackbird Capital is born as a new aircraft leasing company

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Air Lease Corporation (Los Angeles) has  announced that a wholly-owned subsidiary of the Company entered into a joint venture with a co-investment vehicle (the “JV Partner”) arranged by Napier Park Global Capital (US) LP (“Napier Park”) for the purpose of investing in commercial aircraft and leasing them to airlines around the globe. The newly formed entity with committed equity and debt capital is named Blackbird Capital I LLC (“Blackbird Capital I”) and 90.5% of the equity is owned, through the JV Partner, by a pooled investment vehicle of long-term institutional investors managed by Napier Park. The Company owns 9.5% of the joint venture and will not consolidate the entity.

The joint venture is expected to acquire total aircraft assets of approximately $2.0 billion by year-end 2016, with up to $500 million in equity and the remainder financed by a committed $750 million warehouse credit facility (which includes an accordion feature that could make the total facility up to $1.5 billion) and other forms of debt financing. ALC will provide management services over a 12 year period to the joint venture for a servicing fee based upon aircraft assets under management. In addition, the Company expects to sell aircraft from its portfolio to the joint venture with an aggregate value of approximately $500 million by year-end 2016. Through the joint venture, ALC will manage up to $2.0 billion of additional aircraft lease transactions to better serve the airline industry.

“We are excited to partner with Napier Park and its group of institutional investors because they share ALC’s vision of creating long-term value through leased aircraft assets,” said Steven F. Udvar-Hazy, Chairman and Chief Executive Officer of Air Lease Corporation. “Blackbird Capital I is an important partnership for ALC’s strategy to grow our management business and serves as a model that can be replicated in the future.”

“Blackbird Capital I benefits all of the parties involved, including Air Lease Corporation, its global aircraft leasing customers, Napier Park and our investors. We look forward to a successful, long-term partnership with ALC and its management team,” said James O’Brien, Napier Park’s co-Managing Partner. “This joint venture continues Napier Park’s focus on partnering with leading industry operators to support their core businesses.”

“ALC’s core aircraft leasing business has generated strong profitability and stable returns for our shareholders. Now, with Blackbird Capital I, we will be able to supplement our existing leasing platform and serve our airline customers even better by providing additional lease opportunities beyond our current orderbook and customer credit and risk parameters,” said John L. Plueger, President and Chief Operating Officer of Air Lease Corporation.

Macquarie Capital acted as financial advisor in the formation of the joint venture.

The revolving warehouse facility was arranged by BNP Paribas, as Structuring Agent, Syndication Agent and Joint Lead Arranger, Credit Suisse A.G. as Joint Lead Arranger, and includes Bank of America, N.A., The Royal Bank of Scotland plc, Citibank, N.A., and MUFG Union Bank, N.A.

Hughes Hubbard & Reed LLP advised the joint venture, Munger Tolles & Olson LLP advised the Company, and Sidley Austin LLP advised Napier Park, in each case in connection with the formation of the joint venture. Milbank, Tweed, Hadley & McCloy LLP advised the lead arrangers and the lenders in connection with the warehouse facility.

The following section provides transaction details and additional clarification in a “Question and Answer” format:

1) How does ALC benefit from the formation of Blackbird Capital I?
• Blackbird Capital I allows ALC to manage and, through its minority interest, participate in profitable lease deals that were previously passed on for various reasons, including customer concentration limits
• While purchase decisions are authorized by the joint venture board, the vehicle can serve as a sales outlet for ALC’s current fleet, while ALC continues to manage the aircraft and remains as the primary interface with the customer pursuant to the contractual servicing and management agreements
• The joint venture is managed by ALC and therefore creates a source of stable, long term management fee income for ALC based upon assets under management
• Blackbird Capital I is expected to expand ALC’s leasing footprint

2) What are the anticipated sources of aircraft to be purchased by the joint venture?
• It is expected that in building a portfolio of aircraft of up to $2.0 billion, the joint venture will acquire aircraft both externally and from ALC’s fleet
• The aircraft targeted for acquisition by the joint venture will include incremental aircraft opportunities to ALC’s current commitments
• The aircraft targeted are expected to be similar to the aircraft types and customer profiles that currently comprise ALC’s fleet

3) How will ALC account for the joint venture on its financial statements?
• ALC will recognize management fee income as earned and account for its share of ownership in Blackbird using the equity method of accounting
• ALC’s investment in the entity will be reflected in Other Assets on ALC’s balance sheet
• Blackbird Capital I will not be consolidated into ALC

KLM leases two additional Boeing 777-300 ERs from Air Lease Corporation

Air Lease Corporation (Los Angeles) has announced long term lease agreements with KLM Royal Dutch Airlines (Amsterdam) for two additional new Boeing 777-300 ER aircraft, scheduled for delivery in the second half of 2016 and early 2017. These aircraft placements are in addition to the two new 777-300 ER aircraft scheduled for lease from ALC to KLM in early 2015 and early 2016, all from ALC’s order book.

Copyright Photo: TMK Photography/AirlinersGallery.com. Boeing 777-306 ER PH-BVK (msn 42172) of KLM taxies at the Amsterdam base.

KLM: AG Slide Show