Irish-based aircraft lessor, AerCap has officially announced that it has finalised a deal to buy rival aircraft lessor, GE Capital Aviation Services (GECAS) in a deal said to valued at more than US$30 billion. This deal with General Electric (GE) will make AerCap the industry leader in the aviation leasing sector. In total AerCap which has its headquarters in Dublin, Ireland will own and manage over 2,000 aircraft, over 900 engines in addition to owning over 300 helicopters and will also have roughly 300 customers all over the world.
The CEO of AerCap, Aengus Kelly said he was “excited” about acquiring GECAS, an aviation lessor and financier with over 50 years of experience. In a company statement, the Chief Executive Officer of AerCap, Aengus Kelly said “AerCap and GECAS both have industry-leading teams, attractive portfolios, diversified customer bases and order books of the most in-demand new technology assets.”
Under the terms of the agreement, which has already been approved by the boards of directors of both AerCap and GE, GE will receive US$24 billion of cash and $1 billion of AerCap notes and/or cash. In addition to this GE will also own 46% of AerCap through the issue of 111.5 million shares, which have a market value of approximately $6 billion as of yesterday, March 9th.
In a company statement, the CEO and Chairman of GE, Mr Lawrence Culp Jr. said, “AerCap is the right partner for our exceptional GECAS team. Bringing these complementary franchises together will deliver strategic and financial value for both companies and their stakeholders.” The CEO and Chairman of GE added, “This is the right time to further accelerate our transformation. This action will enable us to significantly de-risk GE and continue on our path to being a well-capitalized company.”
The transaction will still have to be signed off by regulators and is expected to be completed by the fourth quarter of 2021. Under the agreement, the combined company will remain under that name AerCap, with GECAS, which is based in Shannon, Ireland becoming a company of AerCap. As part of the agreement, AerCap will have an order book for 493 new technology aircraft of which more than 90% are narrowbodies.
Despite the decline in travel demand, AerCap has said that it will continue to invest in new aircraft in the future. The Dublin based lessor stated that new technology aircraft will make up approximately 56% of the combined fleet between AerCap and GECAS and the aircraft lessor hopes to increase this figure to 75% by the end of 2024. In addition to aircraft leases, AerCap will also be able to offer customers a “premier engine leasing business,” which according to AerCap will offer “revenue diversification and greater ability to provide innovative solutions” to airline customers.
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Source: https://aeronewsx.com/aircraft-lessor-aercap-confirms-acquisition-of-gecas/?utm_source=rss&utm_medium=rss&utm_campaign=aircraft-lessor-aercap-confirms-acquisition-of-gecas
