Air Lease Corporation Announces Pricing of Public Offering of $500.0 Million of Senior Unsecured Medium-Term Notes
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Insights
The announcement by Air Lease Corporation regarding the pricing of their $500 million senior unsecured medium-term notes offering carries significant implications for the company's financial structure and liquidity. The interest rate of 5.100% is a critical figure, as it reflects the cost of capital for the company in relation to the current interest rate environment. Investors and analysts would compare this rate to those of similar maturities in the market to assess the attractiveness of the Notes. The use of proceeds for general corporate purposes, including the acquisition of commercial aircraft and repayment of existing debt, indicates a strategic move to optimize the company's balance sheet and invest in assets that could potentially generate revenue. However, the impact on the company's debt-to-equity ratio and overall financial health will depend on the profitability of the new assets and the terms of the debt being refinanced.
The timing and conditions of the offering are indicative of the company's market positioning and investor sentiment. The fact that multiple reputable financial institutions are acting as joint book-running managers suggests confidence in Air Lease Corporation's creditworthiness and market appeal. For stakeholders, the medium-term maturity of the Notes, due in 2029, provides a moderate investment horizon that balances yield with the risk associated with the aviation industry's cyclical nature. Additionally, the semi-annual interest payments offer a steady income stream for bondholders. The aviation industry's recovery trajectory post-pandemic will be a significant factor in evaluating the risk associated with this investment. It's important to monitor industry trends such as travel demand, fuel costs and regulatory changes that could influence Air Lease Corporation's performance and, by extension, the value of the Notes.
The offering is conducted under a shelf registration statement filed with the SEC, which allows for a more expedient process of capital raising when market conditions are favorable. The legal framework governing the issuance of these Notes ensures that investors have access to essential information through the prospectus supplement and any additional filings. It is crucial for investors to review these documents to understand the covenants, rights and restrictions associated with the Notes. The legal standing of the Notes as senior unsecured debt means they rank higher in the event of liquidation compared to subordinated debt, yet without the security of backed assets. This positioning influences the risk profile of the investment and should be considered alongside the company's overall creditworthiness and the industry's economic outlook.
The Notes will mature on March 1, 2029 and will bear interest at a rate of
The Company intends to use the net proceeds of the offering for general corporate purposes, which may include, among other things, the purchase of commercial aircraft and the repayment of existing indebtedness.
BMO Capital Markets Corp., BofA Securities, Inc., Mizuho Securities
The Notes are being offered pursuant to the Company’s effective shelf registration statement, previously filed with the Securities and Exchange Commission (the “SEC”) on May 7, 2021. The offering of the Notes is being made only by means of the prospectus supplement, dated May 7, 2021, supplementing the base prospectus, dated May 7, 2021, as may be further supplemented by any free writing prospectus and/or pricing supplements the Company may file with the SEC. Before you invest, you should read the base prospectus, prospectus supplement and any other documents the Company may file with the SEC for more complete information about the Company and this offering. You may obtain these documents for free by visiting EDGAR on the SEC’s website at www.sec.gov. Alternatively, copies may be obtained from: (i) BMO Capital Markets Corp. toll-free at +1 (866) 864-7760, (ii) BofA Securities, Inc. toll-free at +1 (800) 294-1322, (iii) Mizuho Securities
This press release does not constitute an offer to sell or the solicitation of an offer to buy the Notes, nor shall there be any sale of the Notes in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the expected closing of the offering and the intended use of proceeds. Such statements are based on current expectations and projections about the Company’s future results, prospects and opportunities and are not guarantees of future performance. Such statements will not be updated unless required by law. Actual results and performance may differ materially from those expressed or forecasted in forward-looking statements due to a number of factors, including but not limited to, unexpected delays in the closing process for the Notes, unanticipated cash needs, and those risks detailed in the Company’s filings with the SEC, including the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2023, June 30, 2023 and September 30, 2023.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240117551107/en/
Investors:
Jason Arnold
Vice President, Investor Relations
Phone: +1 310.553.0555
Email: investors@airleasecorp.com
Media:
Laura Woeste
Senior Manager, Media & Investor Relations
Ashley Arnold
Senior Manager, Media & Investor Relations
Phone: +1 310.553.0555
Email: press@airleasecorp.com
Source: Air Lease Corporation
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