Avolon Aerospace Leasing (AAL), the wholly-owned subsidiary of Avolon, a global aviation finance company, established a $1.5 billion commercial paper program.
Under the program, AAL may issue from time to time short-term, unsecured commercial paper notes under the exemption from registration contained in Section 4(a)(2) of the U.S. Securities Act of 1933, as amended, with the aggregate principal amount of notes outstanding at any time not to exceed $1.5 billion. The notes will be fully and unconditionally guaranteed by Avolon and certain of its subsidiaries. The notes and the guarantees will rank at least pari passu with all other unsecured and unsubordinated indebtedness of AALL and the guarantors, respectively.
The program further diversifies Avolon’s funding sources and provides an additional flexible and cost-effective source of short-term capital to complement the company’s existing revolving credit facilities. Net proceeds from any issuance under the program are expected to be used for general corporate purposes, which may include funding aircraft acquisitions and the repayment of existing indebtedness.
The notes and the related guarantees have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
“The establishment of this commercial paper program marks another important milestone in the continued evolution of Avolon’s funding and liquidity strategy,” Ross O’Connor, chief financial officer of Avolon, said. “It provides additional flexibility to optimize our funding mix, supported by our investment-grade credit ratings, strong liquidity position and robust balance sheet, whilst broadening our investor base and diversification.”
