International Lease Finance Corporation (ILFC), a wholly owned subsidiary of American International Group, has priced, and entered into an agreement to issue and sell, subject to certain conditions, $650,000,000 aggregate principal amount of 8.625% senior notes due 2022. The offering is expected to close on December 22, 2011, subject to the satisfaction of customary market and other closing conditions.
The Notes will pay interest semi-annually on each January 15 and July 15 at a rate of 8.625% per year, beginning July 15, 2012, and will mature on January 15, 2022.
The Notes will be unsecured and will not be guaranteed by ILFC's parent, any of ILFC's subsidiaries or any third party.
The Notes will be issued by ILFC at the initial price of 100.00% of the principal amount. The aggregate net proceeds from the sale of the notes, after deducting underwriting discounts and commissions, fees and estimated offering expenses, will be approximately $641.6 million and will be used by ILFC for general corporate purposes, including the repayment of existing indebtedness and the purchase of aircraft.
The notes offer a higher yield than similarly rated companies that yield 4.51% on average on debt with the lowest investment-grade tier of BBB and 8.99% on bonds with B grades.
Credit-default swaps on ILFC have declined to 697.8 basis points from as high as 931.9 basis points on October 4, reflecting the lessor’s stronger market position.
ILFC prices senior note offering
