(25 September 2019, Hong Kong) China Aircraft Leasing Group Holdings Limited ("CALC", stock code: 01848.hk), a member company of China Everbright Group, is launching a USD 400 million five-year unsecured syndicated aircraft finance revolving facility (the “Facility”) through its wholly-owned subsidiary, CALC Capital 1 Limited (the “Borrower”). The proceeds of the Facility will be used to finance part of the acquisition cost of the aircraft portfolio owned or to be acquired. CALC is currently inviting Mandated Lead Arrangers (the “MLAs”) to coordinate the Facility.

Similar to the increasingly popular asset-backed securitizations (ABS), the Facility is earmarked for a portfolio of aircraft on lease to well-diversified global airlines, yet offers extra protection to the lenders by adding CALC, together with the owners of the aircraft (the “Owners”) to be financed under the Facility, as a joint and several guarantors. The Facility will also engage a tightly structured ring-fencing mechanism to ensure the lenders as senior obligees of the Borrower and the Owners and they will be restricted from carrying out other business as well as creating any security on its aircraft and other assets under the negative pledge undertakings.

Earlier this year, CALC closed a five-year pre-delivery payments (“PDP”) syndicated loan facility of USD 840 million to finance PDP to aircraft manufacturers for aircraft before delivery, a significant upsize from the launch scale of USD 400 million; while this Aircraft Finance Facility is backed by a portfolio of post-delivery aircraft with stable rentals secured by long-term leases to airlines.

CALC is one of the world's top ten aircraft lessors by the asset value of fleet and order book, according to ICF International, a world-renowned aviation consultancy firm. A substantial order book of 227 aircraft scheduled to deliver by 2023 signifies a robust growth in the years to come. In the past five years, CALC's owned fleet size expanded 2.5 times to 115 while it managed to lower its gearing ratio significantly thanks to the implementation of asset-light strategy, which is set to gain momentum powered by the launch of the Facility.

With its resilient nature, the air passenger traffic has doubled every 15 years since the 1970s. In the latest market outlook forecast issued earlier this month, both Airbus and Boeing reconfirmed their positive projection of over 4% of air traffic growth annually in the next 20 years, manifesting a sustainable and solid growth in aviation which is hardly seen in other industries.