Castlelake, a global alternative investment manager specializing in asset-based investing with nearly 20 years of experience in aircraft investing, leasing and servicing, entered into a sale-purchase agreement with Avolon, a leading global aviation finance company, for the sale of a $5 billion, 118-aircraft portfolio held by Castlelake Aviation Limited ("CA Ltd.").
Castlelake established CA Ltd. in 2021 to finance modern, fuel-efficient aircraft. The entity's portfolio grew to over $5 billion of asset value in the three years since its inception and consists of some of the most in-demand narrowbody, widebody and regional jet aircraft types. The sale of the portfolio simultaneously contributes to Castlelake's goal of delivering attractive risk-adjusted returns to its investors and provides Avolon with a fleet of high-quality aircraft assets.
"With this agreement, we're pleased to achieve what we believe to be a great outcome for all involved parties," said Joe McConnell, Partner and Deputy Co-Chief Investment Officer at Castlelake. "We're proud of the incredible accomplishments of CA Ltd., thank our investors and partners for their support and look forward to reinvesting the proceeds of this transaction into new opportunities to provide innovative financings to airlines and leasing companies."
“This transaction accelerates our growth plans adding a portfolio of assets that will further strengthen our cashflow and earnings profile,” said Andy Cronin, Chief Executive Officer at Avolon. “Our balance sheet strength, high levels of liquidity, and established capital markets access have enabled us to acquire these assets. They are complementary to our existing portfolio and will increase our fleet at attractive yields, supporting our positive ratings trajectory.”
Castlelake has been a strategic partner and active capital provider to aviation asset owners and lessees since its inception in 2005, having invested over $21 billion in aviation opportunities, acquired more than 650 aircraft and developed relationships with approximately 200 airlines. Its aviation platform includes in-house specialized teams that are dedicated to maximizing value at each stage of investing, financing, managing and trading aviation assets.
The transaction is subject to the satisfaction of customary closing conditions and is expected to close in Q1 2025. Goldman Sachs & Co. LLC is acting as exclusive financial advisor to Castlelake and Milbank LLP is acting as its legal counsel.