BOC Aviation taps Asian and European investors with $300m unsecured deal

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BOC Aviation has further diversified its investor base in Asia and Europe with its latest $300 million unsecured notes offering.

The five-year term transaction was priced at a fixed interest coupon of 3.875% per annum. It represented the first time since May 2013, the Singapore-based lessor issued US dollar dominated bonds.

“The positive response represents the confidence that the investment community has in BOC Aviation and the important role that we have in a growing aircraft leasing industry,” says BOC Aviation’s managing director and chief executive Robert Martin.

The lessor received orders from more than 90 high quality fixed income accounts. In terms of geographic distribution, the notes were distributed 75% in Asia and 25% in Europe. Asset and fund managers represented 36% of the allocation, followed by 31% private banks. Banks and insurance companies accounted for 15% each while another 3% went to corporate companies, says BOC Aviation.

The notes, which were issued off BOC Aviation’s $5 billion Euro medium term note programme will close on 9 May, 2014, subject to the satisfaction of customary closing conditions.

The joint global coordinators were BOC International, Citigroup and HSBC. The joint lead managers and joint bookrunners were BNP Paribas, BOC International, Citigroup, DBS Bank, HSBC, J.P. Morgan and Morgan Stanley.

The yield to investors will be 4.107% annually, representing a spread of 240 basis points over five-year US Treasury notes.

The unsecured notes will be listed on the Singapore stock exchange and will be rated BBB- by Standard & Poor’s Rating Services, and A- by Fitch Ratings.