News – UK – GE is about to sell its aircraft leasing business to Dublin’s AerCap

0
3

AerCap managing director Aengus Kelly would have a group with over 3000 aircraft owned, managed or ordered when the group buys GEâ ???? s leasing business Photo: Dara Mac Dónaill

General Electric is about to reach an agreement to combine its jet leasing business with Irish employees familiar with the matter, AerCap Holdings, to support the world’s two largest aircraft financiers in a market affected by the coronavirus pandemic is haunted

A deal could be announced as early as Monday, said one of the people, both of whom asked not to be named to discuss the matter, with the deal expected to be valued at more than $ 30 billion, that said Wall Street Journal, which reported the talks the previous Sunday

GE Capital Aviation Services (Gecas) and AerCap have nearly 3000 aircraft owned, managed or ordered

A combination would accelerate GE CEO Larry Culp’s push to streamline the U.S. industrial icon after an epic corporate collapse while the terms of the potential deal with AerCap are unclear, a sale of Gecas GE could raise about $ 25 billion said Bloomberg Intelligence in a 2019 report

Last year, GE completed the sale of its biopharmaceutical business to Danaher, Mr. Culp’s former employer, for $ 21 billion

A deal could be a win-win situation Mark Martin, founder of Dubai-based Martin Consulting, which advises the aviation industry, said for both the corporate and the aviation industry

???? GE and AerCap are clearly seeing renewed interest in engine refinancing and engine leasing on a backdrop of a post-Covid rebound as the industry needs to rebuild itself so this is also uniquely positioned to mitigate the blow to airlines he said

GE declined to comment and AerCap representatives could not be immediately reached for comment outside of normal Sunday business hours

AerCap, headquartered in Dublin and listed on the New York Stock Exchange, has a market value of $ 6.6 billion. Its stock rose 11 percent this year after falling 26 percent last year, according to GE this year 3 increased by 26 percent; decrease of 2 percent in 2020

The pandemic has hit the aviation industry, pushing airlines around the world to cancel new Jetliner orders, postpone delivery dates and postpone lease payments, however, given the weight of the two companies in global aircraft finance, a combination of antitrust, other regulators, is likely and business partners are checked

For GE, a merger would mean a departure from the company’s long-standing business model of leveraging its powerful leasing platform to generate sales of commercial aircraft powered by the company’s jet engines and GE’s financial arm has been scaled back significantly since it owned the company nearly crippled during the 2008 financial crisis

“The old world where you needed a leasing company to support your manufacturing is gone,” George Ferguson, analyst at Bloomberg Intelligence, said For AerCap, this could be something too good to refuseâ ?? ??

Mr. Culp has been running down assets at GE over the past several years as part of his broader turnaround efforts after a collapse that wiped out more than $ 200 billion in total market value in 2017 and 2018 under his leadership the Gecas portfolio was left in a kind of “caretaker status” Mr. Ferguson said

In 2019, GE agreed to sell an aircraft finance business for $ 3 billion to Apollo Global Management and Athene Holding when the troubled maker downsized its once-huge credit arm that same year, Mr. Culp accelerated a plan to sell GE’s stake to oilfield services company Baker Hughes to realign GE’s once sprawling industrial company

The sale of assets raised important funds that GE used to repay its inflated debt burden This is one of Mr. Culp’s top priorities in his turnaround.The company has reduced approximately $ 30 billion in debt since 2019, of which $ 16 billion last year GE had approximately $ 75 billion in total at the end of 2020 -Dollars added

A deal with Gecas would likely improve Aengus “Gus” ‘s profile Kelly, AerCap’s tenacious CEO He stepped on the global stage in 2014 with AerCap’s $ 7 billion acquisition of leasing pioneer ILFC from American International Group

By pooling assets, the new company may have cheaper access to capital markets than Gecas could trade under the GE umbrella, Ferguson

said

Gecas had about $ 35 billion in net worth $ 9 billion at the end of last year, of which about $ 1650 aircraft owned, serviced or ordered AerCap, with assets of $ 42 billion, owned 939 aircraft and managed 105 according to a regulatory filing, and ordered 286 aircraft, including jet models such as the Airbus SE A320neo and Boeing Co 737 max

Greg Conlon, CEO of Gecas, said at the Airline Economics conference in January that the company is considering mergers and acquisitions, portfolio purchases and opportunities in cargo aircraft and jet engine leasing.Mr Kelly spoke at the same conference and said that fewer airline customers asked for a postponement – Bloomberg

AerCap, General Electric, GE Capital Aviation Services, Aircraft Leasing

News – GB – GE is about to sell its aircraft leasing business to Dublin’s AerCap

Source: https://www.irishtimes.com/business/transport-and-tourism/ge-close-to-selling-aircraft-leasing-business-to-dublin-s-aercap-1.4504151