Operating lessor Avolon today announced its intention to partner with Wells Fargo to form a new joint-venture leasing business with a target portfolio of $500 million called Avolon Capital Partners (ACP).
The new business, which would be based in Dublin, is subject to a number of regulatory approvals, according to Avolon, which confirms the move.
Since its start in 2010, Avolon has raised a total of $3.7 billion of debt capital from a range of financial institutions, including Wells Fargo. The lessor has a fleet of 167 aircraft including 76 orders, according to its website,
ACP would build an aircraft fleet primarily through sale and leaseback transactions involving new aircraft, says Avolon.
Wells Fargo would be the majority shareholder and provide banking and debt financing facilities for the business.
Avolon's chief financial officer, Andy Cronin, will serve as a director on the board of ACP. Daire O'Criodain, an executive at Avolon, will serve as ACP's managing director.
Wells Fargo completed its first aviation deal in 2010 - a secured financing with Air Lease Corporation. Two other secured deals with Avolon and AWAS followed in 2011 and 2012, respectively.
Through September 2012, Wells Fargo completed approximately $675 million in financings, excluding legacy transactions originated by Wachovia, which it acquired in 2008 for $15.1 billion in an all-stock deal.
Cronin says: "We are delighted to announce the formation of ACP. Avolon has a strong relationship with Wells Fargo and they remain a core lender to the Avolon business. The joint-venture is a natural evolution of our relationship and combines their international franchise with the expertise and capability of the Avolon team."
Julie Caperton, head of asset-backed finance and securitisation at Wells Fargo, adds: "We are pleased to be able to deepen our relationship with Avolon, a longstanding Wells Fargo client with a proven management team, and to provide funding which enables them to expand their successful operations in the aircraft leasing sector."