DVB Sponsored KDAC ABS of $772.5m Closed

Editor -

DVB announces the closing yesterday of KDAC 2017-1 raising US$722.5m of 144A secured bonds which refinanced the “Big Sky” 2016 term loan facility led by BNP, Citi and DVB. This is our second ABS deal after DCAL 2015-1 which raised $667m.

KDAC 2017-1 was the second largest public issuance in aircraft ABS in 2017 in a year that has seen 12 issuances. The KDAC series A notes rated A/A by S&P and Kroll, was priced with one of the tightest spreads over mid-swaps achieved in the aircraft ABS market at 202bps. This deal had the highest widebody concentration in aircraft ABS since…DCAL 2015-1… There is absolutely no doubt that investors took great comfort from the performance to date of the DCAL deal and DVB’s credibility and stature in this market. Our Aviation platform story sells very well.

· Series A Notes rated A/A: Coupon: 4.212% | Yield: 4.250% | Spread: 202 bps
· Series B Notes rated BBB / BBB: Coupon: 5.926% | Yield: 6.000% | Spread: 377 bps
· Series C Notes rated BB / BB- : Coupon 7.385% | Yield 7.500% | Spread: 536 bps

DVB AAM acts as Servicer to the ABS
DVB AIM acts as investor advisor to the KDAC company
DVB Bank SE is liquidity facility provider
DVB Capital Markets was Co-Manager of the issuance

For KDAC the refinancing has returned approx. US$100m or approx. 49% of equity to the shareholders (KKR 80% : DVB 20%) about 18 months after the portfolio acquisition, boosting the expected IRR of this portfolio to circa 17%.

Annual fees earned by DVB include AIM and AAM fees which will total circa $3.0m per annum.