PIMCO, GECAS join forces to develop $3bn aviation leasing platform
PIMCO, a US-based investment management company, and commercial aviation financing and leasing company GE Capital Aviation Services (GECAS) are partnering to develop an aviation leasing platform to support up to $3 billion in aircraft asset financings.
The new investment platform will help accounts advised by the two firms in buying new and young fuel-efficient aircraft to address the long term requirements of a diverse set of global airlines.
The critical financial needs of the airlines needed for upgrading their existing fleets with young and new aircraft are expected to be met by the aviation leasing platform.
PIMCO and GECAS will consider a variety of investment criteria such as assets of airlines, their credit quality, apart from geographic factors. Initially, the portfolio will concentrate on narrowbody aircraft while maintaining the flexibility to invest in attractive opportunities across the widebody market.
PIMCO, with its footprint in the aviation financing markets, along with the leadership role of GECAS in the aircraft-leasing segment will offer the joint platform a lot of flexibility to provide funding to the global airline sector.
Greg Conlon – President and CEO of GECAS said: “We are delighted to team up with a premier institutional investor such as PIMCO in this strategic relationship which will enable opportunistic plays to support our airline customers around the globe.
“While GECAS maintains an industry-leading position, this platform will ensure we can continue providing our airline customers with the aircraft needed to sustain their franchises.”
GECAS will be responsible for bringing transactions for the platform, act as a servicer, and also offer it asset management services.
Commenting about the new aviation leasing platform, Dan Ivascyn – PIMCO Group Chief Investment Officer said: “As the airline industry struggles with the effects of the COVID-19 pandemic, the PIMCO-GECAS platform will inject essential liquidity into this critical industry by providing financing solutions at a time when there are fewer traditional financing options for airlines.
“Aircraft remain an attractive asset class in a critical infrastructure sector supported by solid long-term growth drivers. GECAS’ expertise as a world class aircraft lessor aligns with our longstanding investment strategy in aviation finance.”
The deal is subject to the necessary regulatory approvals and meeting of other customary closing conditions.