FLY Leasing Sells 12 Older Aircraft for US$240 Million

Ireland's FLY Leasing is selling 12 older aircraft from its portfolio for US$240 million as the company continues its fleet renewal strategy.

The aircraft will transfer individually to the unidentified new owner, with all transfers expected to be completed by the end of the year. FLY said the sale is expected to produce a US$12 million pre-tax gain, and it expects to incur US$3 million in non-cash charges relating to debt modification and curtailment costs. The company said the gain and associated expenses would be recognized on a pro rata basis at the time of each transfer. The sale is subject to the usual closing conditions.

FLY CEO Colm Barrington said: "FLY is moving decisively to monetize older aircraft and to reinvest the capital into younger aircraft to drive higher return on equity. In total, this year we have sold -- or contracted to sell -- 57 aircraft with an average of 13 years."

He said FLY believes this is "the right time to rotate out of mid-life and older aircraft and to invest in younger models." The 12 aircraft have an average age of 13 years and the sale will produce approximately US$80 million in cash. This is on top of a US$35 million gain and US$425 million in cash to be generated by a portfolio sale of 33 aircraft announced in June.

FLY also completed the sale of a 22-year-old Boeing 747-400 aircraft earlier this month.

FLY leases its aircraft under multi-year operating lease contracts to airlines across the globe. It is managed and serviced by U.S.-based aircraft lease, management, and financing firm BBAM.