DUBLIN, Ireland, December 3, 2018 – Fly Leasing Limited (NYSE: FLY) (“FLY”) today announced that it has contracted to sell 12 narrowbody aircraft from its portfolio. The 12 aircraft have a weighted average age of 10.6 years and an average remaining lease term of 3.2 years.
FLY anticipates the sales will generate in excess of $125 million of cash after repaying debt and satisfying other transaction-related expenses. It is expected that the sales will be completed by March 31, 2019.
“These sales meet several strategic objectives, particularly reductions in our leverage and our lessee concentrations. We expect to announce more sales over the coming months as we prepare for our growth pipeline of more than $2 billion of A320neo family aircraft that begin delivering in 2019,” said Colm Barrington, CEO of FLY.
Following these sales, FLY’s fleet will comprise 104 aircraft with an average age of less than seven years and on lease to 44 airlines in 24 countries. FLY has signed commitments to acquire 21 new A320neo family aircraft delivering between 2019 and 2021 and has options to acquire 20 more A320neo family aircraft delivering between 2019 and 2025.
Specifics, according to SEC form:
On November 30, 2018, Fly Leasing Limited (“Fly”) agreed to sell 12 aircraft to Horizon Aircraft Finance I Limited and Horizon Aircraft Finance I LLC (together, the “Purchasers”). The transaction (the “Transaction”) was effected pursuant to a Purchase Agreement (the “Purchase Agreement”), dated as of November 30, 2018, among the Purchasers and the sellers party thereto, including subsidiaries of Fly.
The Purchasers will pay an aggregate of approximately $295 million to acquire the 12 aircraft, subject to adjustment based on rents and maintenance reserves in respect of the aircraft. The Purchase Agreement provides for delivery of the aircraft to the Purchasers over a period of 270 days from the date of the Purchase Agreement (or, for no more than ten aircraft remaining to be transferred to the Purchasers, 365 days from the date of the Purchaser Agreement), subject to customary closing conditions.
The aircraft in the Purchasers’ portfolio will be serviced and managed by affiliates of BBAM Limited Partnership, whose affiliates also manage and service Fly’s aircraft portfolio.
Fly expects the aircraft sales to close principally in the first quarter of 2019.