AerCap prices $750 million junior subordinated notes, leases 10 A321neo to Turkish Airlines

AerCap has leased 10 new Airbus aircraft to Turkish Airlines on July 9, a day after it priced a new notes offering. The 10 aircraft on lease to Turkish Airlines are all new A321neo jets. ""We are very pleased to support Turkish Airlines with the lease of these ten new A321neo aircraft, helping them to continue to grow their extensive route network while modernizing their narrowbody fleet for greater operational efficiency,"" said AerCap CEO Aengus Kelly. ""This addition aligns with our strategy to continue offering our passengers a modern and efficient travel experience, while supporting our ongoing expansion plans for new routes and increasing the frequency of existing ones,"" commented Turkish Airlines chairman of the board and executive committee Ahmet Bolat. It has priced an offering of $750 million of junior subordinated notes due 2055. The notes will be issued with an initial coupon of 6.950% per annum, to be reset on March 10, 2030 and every five years thereafter based on the then-prevailing five-year US Treasury rate plus a spread of 2.720%. The net proceeds from the notes will be used for general corporate purposes, which may include the redemption of all or a portion of its junior subordinated notes due 2029. The notes will be fully and unconditionally guaranteed on an unsecured junior subordinated basis by AerCap. The notes initial price talk was 7.375%. J.P. Morgan, Mizuho, Goldman Sachs & Co. LLC and Santander are serving as joint book-running managers for the underwritten public offering. The notes are rated Baa2 by Moody's, BBB- by S&P Global Ratings, and BB+ by Fitch Ratings. AerCap will report its second quarter earnings on August 1, 2024.