HNA’s Avolon Holdings to acquire CIT leasing business
HNA Group in China has agreed to buy CIT Group’s aircraft-leasing business for US$10 billion in a deal that will create the largest Chinese-owned fleet for rent. HNA’s unit Avolon Holdings will, once the deal is completed, have control of a fleet of 910 aircraft valued at more than $43 billion. The deal is scheduled to be completed at the end of the first quarter after regulatory and shareholder approval, according to statements issued by the companies.
HNA has been on an acquisition spree in recent years and has spent more than US$10 billion this year alone on airports, airlines, hotels and other companies. CIT intends to return US$3.3 billion of common equity to shareholders, the New York-based bank said Thursday in a separate statement.
HNA bought a stake in Azul Linhas Aereas Brasileiras, Brazil’s third-largest airline in August and in Mary purchased a stake in Virgin Australia. The company is also buying Swiss catering group Gate Group and also bought baggage company Swissport in February. In January, HNA-controlled Bohai Leasing acquired Avolon in a US$7.6 billion deal.
HNA and Avolon said in their statements that the deal will double the scale of Avolon’s business and create the world’s third-largest leasing company. The deal is expected to increase the company’s customer base by 69 airlines giving it a total of 154 customers in 61 countries with its in-service equally spread with a third each in the Americas, EMEA and Asia-Pacific.
The companies also said after the deal closes that Avolon will have combined orders and commitments for 349 aircraft that includes 282 new technology planes made up of 195 Airbus planes (in a mix of A320s, A330neos and A350s) as well as 59 Boeing 737 MAX planes and 28 Boeing 787s.