Blackbird Capital II LLC Closes $745MM Aircraft Secured Notes to Refinance Debt

Blackbird Capital II Aircraft Lease Limited (BBIRD Cayman) and Blackbird Capital II Aircraft Lease US LLC (BBIRD USA) closed a $745 million fixed rate notes offering, which consists of $630 million of 2.443% Series A fixed rate notes and $115 million of 3.446% Series B fixed rate notes. The Cayman issuer also issued a Series E note representing the equity interest in BBIRD Cayman, which was acquired by Blackbird Capital II LLC.

Moody’s rated the Series A notes and Series B notes A1 and Baa1, respectively. Kroll Bond Rating Agency rated the Series A notes and Series B notes A and BBB, respectively. The notes are backed by a portfolio of 18 aircraft, which will be acquired by the issuers. The aircraft comprise a mix of narrow-body and widebody jet aircraft that, as of May 31, 2021, had an average age of 2.9 years and were leased or expected to be leased to 12 lessees based in 11 countries. Air Lease and its Irish affiliate, ALC Aircraft Limited, will act as servicers with respect to the aircraft.

The issuers will use proceeds from the issuance of the notes to refinance existing warehouse loans and/or acquire the aircraft. Napier Park, through third party funds it manages, and Air Lease, are retaining their equity stakes in the joint venture.

“We are extremely pleased to announce the closing of this significant transaction for Blackbird Capital II,” Shirley Lu, vice president and head of management business of Air Lease, said. “This long-term financing transaction demonstrates the strength of the portfolio and the Blackbird franchise. The Blackbird Capital II portfolio is an integral part of our overall management business, which remains highly complementary to ALC’s platform and enables us to further serve our diverse, global airline customer base. We thank the investors who participated in this deal for their support and Napier Park for their ongoing partnership in Blackbird.”

“This term issuance represents an important milestone in our ongoing Blackbird partnership with Air Lease Corporation. As evidenced by the success of the transaction, Napier Park continues to assemble investment portfolios that are designed to generate attractive risk-adjusted returns through market cycles on behalf of our investors and do so in partnership with leading operators like ALC,” Manu S. Rana, a partner at Napier Park, said.

BofA Securities acted as global coordinator; BofA Securities, Mizuho Securities, Citigroup and BNP Paribas acted as joint lead structuring agents and joint lead bookrunners; MUFG acted as joint lead bookrunner; and Fifth Third Securities, Societe Generale, Goldman Sachs and Deutsche Bank Securities acted as bookrunners on this transaction.

Hughes Hubbard & Reed acted as U.S. counsel to Air Lease and the issuers, and Milbank acted as U.S. counsel to the initial purchasers, the global coordinator, the joint lead structuring agents, the joint lead bookrunners and the bookrunners. EY acted as U.S. and Irish tax advisor. Walkers acted as Cayman Islands counsel and A&L Goodbody acted as Irish counsel.

Canyon Financial Services Limited will act as the managing agent for the issuers. Citibank will act as trustee, security trustee, paying agent and operating bank. Mizuho Bank, acting through its New York branch, will act as the liquidity facility provider. DealVector will provide certain investor services for the holders of the notes.

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