Barings Capital Solutions has announced it has entered into a purchase agreement to acquire a portfolio of narrow-body commercial passenger aircraft through its Capital Solutions platform. The platform invests across the capital structure to deliver tailored solutions, partnering with GENESIS, the full-service aircraft lessor wholly owned by Barings-managed funds, to originate, underwrite, and manage the portfolio.
The portfolio consists of 12 end-of-life narrow-body aircraft and their associated leases, valued at over US$200 million. In line with the Barings Capital Solutions team's investment strategy, the transaction is structured to deliver contractual cash returns to investors, with additional upside potential through asset appreciation.
Michael Searles, Head of North America for Barings Capital Solutions, expressed excitement about partnering with the Genesis team on this unique transaction, highlighting the extensive origination capabilities of both platforms. “We see significant value in the mid and end-of-life aircraft space in today's market as global travel has recovered above pre-pandemic levels, while supply chain disruption has contributed to a supply-demand imbalance.”
Karl Griffin, Chief Executive Officer of Genesis, highlighted the pride in the substantial in-house commercial aircraft investment capability built by Barings and Genesis over the past ten years. This capability enables it to originate, underwrite, actively manage and deliver strong risk-adjusted returns throughout the full life cycle of a commercial aircraft investment.
The Barings' team originates, underwrites, structures, and prices risk with the intent to provide attractive returns throughout market cycles that are less correlated with traditional debt and equity strategies. The strategy pursues public and private market opportunities across the capital structure, with a focus on secured debt, leveraging the sourcing and structuring expertise of the entire Barings platform globally to develop tailored solutions for counterparties.
