Zephyrus Aviation Capital, a fleet management solutions provider focused on older and end-of-life aircraft and engine leasing & trading, has closed the Company's first structured ABS financing, ZCAP 2018-1. Zephyrus Capital Aviation Partners 2018-1 Ltd and Zephyrus Capital Aviation Partners 2018-1 LLC (the Borrowers) will borrow US$336.6 million, which will be used to finance the acquisition of a diversified portfolio of 21 in-production, predominantly narrow-body aircraft on lease to 19 lessees in 14 countries, from Dublin-based Avolon.
ZCAP 2018-1 is comprised of a single Class A tranche of loans in the initial principal amount of US$336.6 million with a fixed coupon of 4.605% yielding 5.153%. The Loans have an initial loan-to-value ratio (calculated as the note amount divided by the lower of the mean and median of appraisers' base values and current market values) of 74% and have been rated A / A by S&P Global Ratings and Kroll Bond Rating Agency, respectively.
This financing event marks the ‘groundbreaking' combination of a newly-launched company acquiring a substantial portfolio directly into an ABS structure. “We are pleased to see such strong demand for our initial ‘out-of-the-box' ABS. With a book that was more than two times over-subscribed, by knowledgeable and quality investors, our transaction structure – of a single-tranche loan format with significant equity fully-retained by Zephyrus – was well-received by the market and signifies approval of Zephyrus' long-term approach,” said Zephyrus CEO Damon J. D'Agostino.
