Aviation news analysis
50 SKY SHADES - World aviation news

CIC, Boeing, among 11 cornerstone investors in BoC Aviation IPO: IFR

Download: Printable PDF Date: 16 May 2016 02:03 category:
Publisher:
CIC, Boeing, among 11 cornerstone investors in BoC Aviation IPO: IFR - Finance publisher
Tatjana Obrazcova
Country: Singapore Aircraft: Airplanes
Source: Reuters

BOC Aviation Ltd has secured 11 cornerstone investors for its $1.1 billion Hong Kong initial public offering (IPO), tapping China Investment Corp (CIC) and Boeing Co (BA.N) as it launched on Monday the largest listing by an aircraft lessor in at least five years.

Sovereign wealth fund CIC [CIC.UL] and China's state-backed Silk Road Fund will invest $100 million each and compatriot CDB International has committed $60 million, showed a term sheet seen by Reuters.

Singapore-based BOC Aviation [IPO-BOCA.HK], a subsidiary of Bank of China Ltd (BOC) (601988.SS), is betting on booming demand for air transportation in the world's second-largest economy. The lessor - the world's fifth-largest by fleet size and fourth-largest by fleet value, according to its IPO prospectus - is selling shares to raise funds for more new aircraft.

U.S. planemaker Boeing forecasts Chinese demand of 6,330 new airplanes over the next 20 years with a total value at nearly $1 trillion, making China one of the biggest markets for the aircraft manufacturing industry.

BOC, China's fourth-biggest lender by assets, is selling new shares in BOC Aviation at a fixed price of HK$42.00 each. It said last week the IPO would value its aviation leasing unit at about $3.8 billion..

The offering would be the biggest for an aircraft lessor since Air Lease Corp (AL.N) raised $801 million in a 2011 IPO, Thomson Reuters data showed.

China Life Insurance Co Ltd (601628.SS) and Chinese private equity firm Hony Capital have each committed $50 million, while Boeing, the world's largest planemaker, has agreed to invest $30 million.

"China is an important and growing market for our business," said Boeing spokesman Chris Villiers in Seattle, confirming the investment in BOC Aviation.

The IPO comes as Asian lessors raise funds to challenge Western rivals in the nearly $217 billion global industry, with huge orders or acquisitions to service the world's fastest-growing aviation market.

Rival CDB Leasing, owned by state-controlled China Development Bank Corp [CHDB.UL], plans to raise $1 billion in an IPO set for the second quarter of this year, people familiar with the matter previously told Reuters..

Cornerstone investors have taken up 52 percent of BOC Aviation's base offering and have agreed to hold on to their shares for six months. The shares are set to start trading on June 1.

BOC Aviation declined to comment on the cornerstone investors. Hony Capital did not immediately respond to a request for comment. CIC, China Life, Silk Road and CDB International could not be immediately reached for comment.



Loading comments for CIC, Boeing, among 11 cornerstone investors in BoC Aviation IPO: IFR...


Recommended

India’s first Airbus Corporate Helicopters ACH145 is delivered to Businessman and Philanthropist Adar Poonawalla

State-of-the-art aircraft includes Airbus Helionix glass cockpit avionics system for enhanced performance and safety Airbus has delivered India’s first fully customised, ACH145 helicopter to...

Garmin® G500H TXi flight displays now certified

Garmin International, Inc., a unit of Garmin Ltd. (NASDAQ: GRMN), today announced the certification and availability of the G500H TXi touchscreen flight display for normal category VFR helicopter...

The year 2018 for Lithuanian Airports – the year of the leap: records have been hit in both number of the passengers and flights

The year 2018 will be recorded among the best aviation years for the company Lithuanian Airports, since new records were reached - 6.3 million passengers were served and 61 thousand flights were condu...

Verdi strike at Frankfurt Airport will lead to significant disruption on Tuesday

Information available at www.lufthansa.com "Verdi escalated through a disproportional series of strikes" The trade union Verdi has called for a comprehensive strike by security per...