In order to position itself among the top 10 worldwide lessors by 2030, Aircraft Leasing Company (AviLease) has agreed to pay $3.6 billion for the aircraft leasing operations of UK-based Standard Chartered.
The jet lessor, based in Riyadh and supported by the Public Investment Fund (PIF), will buy a portfolio of 100 narrow-body aircraft and take on the servicing of an additional 22 aircraft. The integrated platform will manage and supervise 167 aircraft, including a $6 billion owned fleet of 145 aircraft and a $800 million managed fleet of 22 aircraft. According to a statement from AviLease, the corporation leases airplanes to 46 airlines around the world.
The agreement comes as the bank works to meet its 2024 goals by concentrating on business sectors where it distinguishes apart from rivals. The sovereign wealth fund of Saudi Arabia owns the aircraft lessor AviLease, which has its headquarters in Riyadh and is also known as Aircraft Leasing Co. In January, StanChart stated that it was looking into potential changes for its worldwide aviation finance operation.
“The sale of our Aviation Finance leasing business allows us to continue focusing our efforts on those areas where we are most differentiated, and to make further progress on our Return on Tangible Equity journey,” stated Simon Cooper, Chief Executive Officer of Standard Chartered. I want to express my gratitude to our Aviation Finance coworkers, whose dedication to developing an excellent franchise over the course of more than 15 years made this transaction successful.
After the deal closes, Standard Chartered will see a rise in its common equity Tier 1 capital ratio of about 19 basis points and a gain of about US$0.3 billion. The net proceeds from the transaction are expected to be factored into Standard Chartered’s overall management of the capital and liquidity position of Standard Chartered and its subsidiaries.