Avolon and Bohai Leasing, the Chinese leasing and financial services company affiliated with HNA Group, have today entered into an agreement under which Bohai will make a cash tender offer for 20% of the outstanding common shares of Avolon at a price of US$26 per common share. The transaction will be open to all Avolon shareholders. The cash tender offer of US$26 per share represents a 14.5% premium to Avolon’s volume-weighted average price last week and a 30% premium to Avolon’s IPO at US$20 per share in December 2014.
The deal will without doubt give Avolon a good foothold in the Chinese market and it carries good shareholder value, Bohai Leasing on the other hand will gain an increased presence in the global aircraft leasing sector. An Avolon investment grade rating is getting ever closer.