Emirates' $587m aircraft lease deal price talk issued
Dubai, June 28, 2012
Doric Nimrod Air Finance Alpha, the aircraft leasing firm planning to issue bonds to help finance the sale of four Airbus A380 planes for Emirates airline, released initial price thoughts for the deal on Thursday.
The $433.8 million Class A notes with a 10.4-year expected maturity could price in the range of 5.25 and 5.5 percent, while the $153.7 million Class B notes with a 6.9 year maturity may price between 6.75 and 7 percent.
The Class A notes carry an expected rating of A3, with the Class B notes provisionally scored at Baa3.
The company said last week it was planning a two tranche issue of Enhanced Equipment Trust Certificates (EETCs) worth $587.5 million to help fund the planes which will be leased to Emirates.
An EETC is a financial security used in aircraft finance where the airline gets ownership of the planes on maturity of the certificates. The transactions are similar to a form of secured debt financing like mortgages.
While often used by airlines in Europe and the United States, EETC transactions from the Gulf region - home to some of the fastest-growing carriers in the world - are extremely rare.
Goldman Sachs is sole bookrunner on the transaction, which is this week's business.-Reuters