Former Ryanair deputy chief Howard Millar has disclosed that a newly-established fund, which aims to invest in used single-aisle aircraft, is set to launch an initial public offering.
The company, Sirius Aircraft Leasing Fund, is a Guernsey-registered entity. Guernsey’s corporate registry indicates it was registered on 27 September.
Millar is the chief executive of Sirius Aviation Capital Holdings, a company which will act as investment advisor to the new fund.
The proposed initial public offering has a $250 million fundraising target with admission to the London stock exchange.
Sirius Aircraft Leasing Fund states that it believes an “attractive opportunity” exists in the market for acquiring, leasing and selling of used single-aisle aircraft.
It argues that there is a liquid market for such aircraft, with traditional lessors disposing of older airframes to maintain age profiles. Major lessors sold more than 300 aircraft last year, the company says.
At the same time, says Sirius, there is a “growing demand” for used aircraft, creating a liquid secondary market, with operators such as British Airways and Iberia parent IAG, as well as Lufthansa, picking up older airframes.
“For lessees there can be significant cost savings in leasing used single-aisle aircraft compared [with] new aircraft,” it adds.
Value can also be extracted from engines and effective management of maintenance, says Sirius.
The proposed initial public offering will involve an initial placing and offer of ordinary shares, and will also feature a 12-month placing programme for up to 300 million additional shares.
Sirius Aircraft Leasing Fund will use its investment advisor’s contacts to access an “attractive pipeline” of aircraft, and will aim for a dividend yield of 8% per year.
Millar, who also served as chief financial officer of Ryanair, says the investment advisor’s management team has “outstanding” capabilities and contacts.
“We are currently assessing a number of attractive portfolios and anticipate that the funds raised will be deployed within six months of admission,” he adds. The company expects to publish its prospectus later this month with admission taking place in early November.
Sirius Aviation Capital Holdings' senior managers include former Stellwagen Group figures Edward Coughlan, Kieran Ryan and Edward Hansom.
Source: Cirium Dashboard