Merit AirFinance, an aviation lending company focused on providing customized debt capital solutions to airlines and leasing companies, priced an $817 million loan asset-backed securitization (ABS), MERIT 2026-1, marking the company’s first issuance under its MERIT shelf and an important milestone in its capital markets strategy.
The MERIT 2026-1 offering consists of $461 million of Class A notes assigned AAA ratings by both Fitch Ratings Service and Morningstar DBRS. Other tranches were retained by private investors. The notes carry a fixed coupon of 4.852% yielding 4.9%, and will be used to finance a diversified portfolio of 97 secured aviation loans from 10 distinct facilities with 34 underlying lessees. The portfolio reflects a seasoned asset base, with a weighted average asset age of 10.8 years and a weighted average loan maturity of 6.8 years.
“We are grateful for the robust investor interest in this transaction, especially given the current backdrop of market volatility,” Patrick Mahoney, president of Merit, said. “We believe the pricing outcome reflects the quality and diversification of the underlying portfolio, as well as the strength of our investor relationships, and we look forward to building on this foundation as we continue to scale the Merit platform and seek to establish ourselves as a programmatic issuer.”
Merit will act as servicer for the transaction. BNP Paribas is the lead structuring agent and joint lead bookrunner alongside Goldman Sachs. The notes were offered only to qualified institutional buyers under Rule 144A and to persons outside the United States under Regulation S. The notes were not registered under the United States Securities Act of 1933, as amended, and, unless so registered, may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws.
