SMBC Aviation Capital’s wholly-owned subsidiary, SMBC Aviation Capital Finance DAC, has closed the sale of $500 million principal amount of 2.300%, seven-year senior unsecured notes due June 2028. The notes are fully and unconditionally guaranteed by SMBC Aviation Capital.
This bond placement - priced at US Treasury plus 110 basis points – represents the lowest credit spread achieved in a bond issuance by SMBC Aviation Capital.
Joint bookrunners are JPMorgan, Citi, Credit Agricole-CIB, Goldman Sachs, RBC and SMBC Nikko.
The proceeds from the offering will be used for general corporate purposes which may include, among other things, the purchase of aircraft and the repayment of existing indebtedness. The company has recently had its investment grade A- ratings confirmed by S&P and Fitch.
“The successful completion and industry leading pricing achieved on this transaction is a strong endorsement from the market for SMBC Aviation Capital’s financial strength and ability to capitalise on growth opportunities," said Barry Flannery, Chief Financial Officer of SMBC Aviation Capital. "Our strong credit ratings and diversified funding structure provides us with multiple options to execute on our growth plans. As our airline customers now increasingly focus on the recovery and the pent-up demand for travel, we are positioned to capitalize on what will be a period of substantial change and opportunity ahead for the wider sector.”