Waha Capital’s largest investment, AerCap, acquires International Lease Finance Corporation from AIG

May 15, 2014 10:35 am

Waha Capital PJSC, a leading Abu Dhabi-based investment company and a significant shareholder in New York-listed AerCap Holdings N.V., announces the successful completion of AerCap’s acquisition of International Lease Finance Corporation (ILFC) from American International Group (AIG).

AerCap first announced its intention to acquire 100% of the common stock of ILFC on 16 December 2013 for a consideration valued at $5.4bn at the time of the announcement. The consideration was funded by $3.0bn in cash and 97.6 million shares in AerCap. Waha Capital agreed to vote in favor of the transaction in advance of the initial announcement.

Previously AerCap’s largest shareholder with a 26.2 percent stake, Waha Capital, which now becomes the combined company’s second largest shareholder, will continue to hold the same number of shares but will be diluted to a 14.1 percent stake in the significantly larger combined entity. AerCap is now the world’s leading aircraft leasing company with a fleet of over 1,300 aircraft valued at circa $45bn.

According to AerCap, the combined company produced revenue of $5.4bn on a pro-forma basis for the full year ending 31 December 2013. Waha Capital will retain its two seats on AerCap’s Board of Directors, as well as representation on the various Board sub-committees on which it currently serves.

Commenting on the transaction, His Excellency Hussain Jasim Al Nowais, Chairman of Waha Capital said: “This is a groundbreaking transaction which has created a clear market leader in the aircraft leasing industry. Our investment in AerCap clearly demonstrates the additional value that we are able to generate for our shareholders in sectors that offer significant upside potential. This transaction marks another step towards our journey to becoming a key player in the global market”.

Salem Rashid Al Noaimi, CEO and Managing Director of Waha Capital, and a Board member of AerCap, added: “Waha Capital has fully supported AerCap’s acquisition of ILFC from an early stage. As a long-term partner of AerCap, we see significant value being created by the combined company through the dramatic increase in scale and earnings in an industry with strong growth prospects in the coming years.”

AerCap has been a strongly performing investment since Waha Capital’s acquisition in 2010. During this time, Waha Capital has seen the company execute a number of strategic transactions, including a 35 aircraft sale-leaseback with American Airlines in 2011 and the sale of the equity tranche of two securitization vehicles in 2012 & 2014, in addition to this landmark transaction. Waha Capital’s stake in the company is now valued at $1.4bn, as compared to the original investment cost of $388m. Given Waha Capital’s carrying value of $576m as at 31 March 2014, the AerCap investment represents a significant amount of unrealized value for Waha Capital.

Waha Capital has diverse investments in a number of sectors which include aircraft leasing, financial services, healthcare, offshore services for oil and gas, and real estate development. The company is also active in capital markets.