RIYADH: In a significant step to bolster its financial capabilities, Dubai Aerospace Enterprise has secured a record $1.6 billion credit facility with a consortium of 26 financiers.
This financing agreement includes a combination of revolving credit and term financing facilities, with each tranche comprising conventional and Islamic financing components.
HSBC and J.P. Morgan have played a key role in this deal by serving as joint bookrunners and mandated lead arrangers.
This move reflects the support and confidence that banks have shown in the company and its future growth prospects, according to DAE CEO Firoz Tarapore.
“We are delighted with the exceptional outcome delivered by the joint bookrunners, who demonstrated strong leadership, sound market judgment and conviction that has enabled DAE to execute successful financing to support our corporate strategy,” said Tarapore.
The transaction was upsized in syndication to over 100 percent of the predicted initial size with 26 financiers.
Additionally, the facilities helped the aviation services firm tap the liquidity in Islamic banking and further bolster its relationships in the Middle East, Asia, North America and Europe.
“HSBC has a long-standing relationship with DAE, and the very robust demand for this landmark transaction from investors across a wide range of geographies, which resulted in a significant increase in its final size, clearly demonstrates how we use the strength of our network on behalf of our clients,” said Shaikha Al-Marri, head of government and corporates in the global banking team at HSBC Middle East.
Imran Zaidi, J.P. Morgan’s head of corporate banking in the Middle East, North Africa and Pakistan, said: “The transaction was significantly upsized and oversubscribed, underscoring investors’ confidence in DAE’s performance.”
Last month, DAE signed a definitive agreement to acquire 64 Boeing 737 Max aircraft from a subsidiary of China Aircraft Leasing Group Holdings Ltd. as it seeks to add certainty to its growth trajectory.
The portfolio includes 737-8, 737-9 and 737-10 variants. Delivery of the aircraft is scheduled to occur between 2023 and 2026.
In 2017, DAE also became one of the world’s largest aircraft lessors after it completed the acquisition of Dublin-based AWAS, the industry’s tenth-biggest firm at the time.
