Airborne Capital raises €285m against aircraft

Irish aircraft lessor Airborne Capital has raised more than €285 million against 15 of its aircraft.

Airborne buys planes that it leases to airlines around the world and has offices in Dublin, Shannon and other centres, including New York and Hong Kong.

The company recently raised $303.7 million (€285.6 million) in partnership with Marathon Asset Management.

The asset management giant issued bonds through a special purpose company, MAST 2022-1, against 15 Airbus and Boeing planes that Airborne has leased to airlines.

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The asset-backed securitisation – as it is dubbed – allows Airborne to release cash tied up on the aircraft through the bond issue, whose holders will be repaid using the aircraft leasing revenue.

According to aviation finance data and information specialist, Ishka, Airborne’s deal was the industry’s first asset-backed securitisation since June.

Russia’s invasion of Ukraine, which disrupted air travel in Europe, and rising interest rates, left investors cautious of such deals, according to the publisher.

However, Ishka speculates that the Irish operation’s transaction signals a revival in this market.

The 15 aircraft are a mix of Airbus A320s and Boeing 737s, for which there is high demand as airlines around the world favour them for short-haul journeys.

Airborne has leased them to carriers including American Airlines, Poland’s LOT, Hungarian low-cost operator, Wizz, China Eastern, Canada’s Flair Airlines and Norwegian Air Shuttle among others.

Ramki Sundaram, Airborne Capital chief executive, said the Marathon deal was a “strong validation” of the company’s credentials.

Joe Thorstenson, managing director and head of Marathon’s aviation strategy said the company was delighted to raise cash on attractive terms for in-demand aircraft.

Founded in 2017, Airborne manages aircraft worth around $2 billion in total.

Headquartered in New York, Marathon was managing a total of $20 billion at the end of June this year.