StanChart to sell jet leasing arm in USD 700 mn Saudi wealth fund deal, ET TravelWorld
Summary
Standard Chartered said on Monday it was selling its global aviation finance leasing business to Saudi Arabia-based AviLease for USD 700 million, as part of a drive to streamline its operations. The deal comes at a time when the bank is focusing on business areas where it stands out from competitors as it strives to deliver 2024 targets.Riyadh-headquartered AviLease, also known as Aircraft Leasing Co, is a jet lessor owned by Saudi Arabias sovereign wealth fund. StanChart said in January it was exploring options for its global aviation finance business.Dublin-based Standard Chartered Aviation Finance owns and manages more than 120 aircraft and offers services including jet fuel hedging, debt financing and remarketing of unneeded planes.The sale of our Aviation Finance leasing allows us to continue to focus our efforts on those areas where we are most differentiated, Simon Cooper, CEO of Corporate, Commercial & Institutional Banking and Europe & Americas at Standard Chartered, said on Monday.The company expects to record a gain of around USD 300 million from the sale and its common equity tier 1 capital ratio would increase by around 19 basis points.Singapore BOC Aviation Limited and Indias largest airline IndiGo have entered into a finance lease transaction involving 10 Airbus A320NEO aircraft to further expand its fleet, officials said on Wednesday. AviLease is among the few companies that the Saudi Public Investment Fund (PIF) has endorsed as it grows deeper into various sectors. The sector has gone through major consolidation in recent years, with private equity firms jumping in to buy smaller lessors and large players bulking up.PIF is setting up startup carrier Riyadh Air to predominantly serve the kingdoms capital, which has ambitions to become a global business hub.