Waha Capital to Vote in Favour of AerCap Acquisition of International Lease Finance Corporation
Monday, 16 December 2013
ILFC’s Airbus A320neo
AMSTERDAM, NETHERLANDS and ABU DHABI AerCap Holdings N.V. ("AerCap") (NYSE: AER) today announced that it has entered into a definitive agreement with American International Group, Inc. ("AIG") (NYSE: AIG) under which AerCap will acquire 100 percent of the common stock of International Lease Finance Corporation ("ILFC"), a wholly-owned subsidiary of AIG. 

This is based on the closing share price of AerCap’s ordinary shares on Friday 13 December 2013, the total consideration has a value of approximately $26 billion including the assumption of the outstanding ILFC net debt of $21 billion.

Under the terms of the agreement, AIG will receive $3.0 billion in cash and 97,560,976 AerCap shares. While AerCap will acquire 100 percent of the common stock of ILFC.  AIG will receive $3.0 billion in cash and 97.6 million newly issued AerCap shares.
Upon closing of the transaction, AIG will own approximately 46 percent of the combined company, while the existing AerCap shareholders will own approximately 54 percent of the combined company. 

In a separate announcement, Abu Dhabi-based investment company Waha Capital PJSC, currently the largest shareholder of AerCap Holdings N.V. has agreed to vote in favor of the aircraft leasing company’s proposed acquisition of ILFC from AIG. It currently has a 26.3 percent stake in AerCap, will see its shareholding reduced to approximately 14 percent.

The combined portfolio of assets held by AerCap and ILFC will be concentrated in over 85 percent of the fleet by value consisting of A320, A330, Boeing 737NG and Boeing 777 family aircraft. 

The cash portion of the deal  is expected to be funded through a combination of new debt financing and cash of the combined company. The combined company will retain the name AerCap, and ILFC will become a wholly-owned subsidiary of AerCap.

Salem Rashid Al Noaimi, chief executive officer and managing director of Waha Capital, and a Board member of AerCap, said: “We have been a long-term partner of AerCap and as a key investor we are supportive of this transaction which we expect to be value enhancing for AerCap's existing shareholders and indirectly for our own shareholders. 

"This transaction uniquely positions AerCap as the leading aircraft leasing company in an industry with strong growth prospects over the coming years.”

Aengus Kelly AerCap's chief executive officer added: “AerCap's acquisition of ILFC will create the leading global franchise in the aircraft leasing industry. This transaction presents a unique strategic opportunity to bring together the outstanding and experienced personnel from both companies and two attractive portfolios of modern aircraft on lease to a highly diversified customer base.

"Further, we believe AerCap will now have the most attractive order book in the industry. With these combined resources, along with a strong liquidity profile, we will drive high levels of stable long term profitability and cash flows for the benefit of all our stakeholders.”

Robert H. Benmosche, AIG's president and chief executive officer added: "ILFC is a valuable business, and AIG has always taken great pride in ILFC's reputation for innovation, its pioneering role in aircraft leasing, its industry-leading team of employees, and its consistent and successful market leadership.

"The combination of AerCap's young fleet of in-demand aircraft and proven portfolio management capabilities with ILFC's attractive order book and broad marketing reach will continue to lead the industry."

Henri Courpron, ILFC's chief executive officer added: "I am very proud of the hard work and leadership demonstrated by the ILFC team over the past four years. 

"It is because of them that we have the best-in-class order book and solid balance sheet, and our company is now poised for this promising combination with AerCap. Becoming the number one lessor in the world is a just reward for all of this work."

The transaction is subject to approval by the other AerCap shareholders, receipt of necessary regulatory approvals and satisfaction of other customary closing conditions. 

UBS Investment Bank acted as the lead financial advisor to AerCap. Goldman Sachs acted as sole financial advisor to AerCap's Board of Directors. Cravath, Swaine & Moore LLP and NautaDutilh NV acted as legal advisors to AerCap. UBS and Citibank have provided committed financing to AerCap for the transaction.