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CALC issues RFP to MLAs for $400 million five-year unsecured revolver

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CALC issues RFP to MLAs for $400 million five-year unsecured revolver

China Aircraft Leasing Group (CALC) has launched a US$400 million five-year unsecured syndicated aircraft finance revolving facility through its wholly-owned subsidiary, CALC Capital 1 Limited. The proceeds 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 (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 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 US$840 million to finance PDP to aircraft manufacturers for aircraft before delivery, a significant upsize from the launch scale of US$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.