DAE supports first ABS transaction of the year
Dubai-based DAE is behind an asset backed securitisation (ABS) deal for US Falcon Aerospace Limited and Falcon Aerospace USA LLC. The first such transaction in the industry this year.
Falcon is receiving $410 million of asset-backed secured term loans to support the purchase of 21 in-production, narrow-body aircraft.
DAE is the servicer for the transaction.
CEO Firoz Tarapore, said: “We are extremely pleased with the very successful pricing of our inaugural ABS transaction. We welcome the opportunity to broaden our financing base and partner with sophisticated investors in the US capital markets. This transaction will help us achieve our goal of substantially increasing our footprint in the aircraft leasing space.”
The $410million is offered in three classes of loans, all maturing in 2042. The $315 million A loans, with an initial loan-to-value ratio of 63.5%, are rated A by Kroll Bond Ratings and Standard and Poor’s. The $65 million B loan tranche is rated BBB by Kroll and S&P with an initial LTV of 76.6%, while the BB-rated $30 million C loan tranche has an LTV of 82.6%.
Falcon Aerospace Limited will also issue an E Certificate in partial consideration for the sale of the aircraft.
Goldman Sachs is the sole structuring agent on the deal. Credit Agricole-CIB is providing the liquidity facility, with Wells Fargo as the trustee and phoenix American Financial Services as the managing agent.