Aircraft lessor SMBC Aviation nears $7 billion deal for rival Goshawk, sources say

SMBC Aviation Capital, one of the world’s largest aircraft rental companies, is approaching an agreement to acquire minor rival Goshawk for about $ 7 billion, including debt, people familiar with the matter said on Friday.

The deal between the two privately owned, Dublin, Ireland-based landlords could be announced as soon as next week, said the sources, who spoke on condition of anonymity. It would create a global aircraft leasing giant as consolidation sweeps across the industry.

Last year, the world’s two largest aircraft leasing companies, Ireland’s AerCap and GE’s leasing arm GECAS, merged into a deal worth more than $ 30 billion.

SMBC Aviation Capital, which is owned by a consortium including Japan’s Sumitomo Corp and Sumitomo Mitsui Financial Group, has a fleet of more than 750 owned, managed and engaged aircraft, mostly Boeing and Airbus short-haul models, according to its website.

Goshawk, a 50-50 joint venture between Hong Kong-based conglomerate NWS Holdings Limited and Chow Tai Fook Enterprises Limited, has a owned, managed and engaged fleet of 222 aircraft, its website revealed.

A spokesman for SMBC Aviation Capital declined to comment. Goshawk did not immediately respond to a request for comment.

The industry magazine AirFinance Journal first reported on the talks between the two companies in November.

A plethora of businesses have transformed a global aviation finance industry that has attracted a huge amount of capital in recent years.

Last year, private equity firm Carlyle Group Inc.’s aviation investment arm agreed to buy the aircraft leasing company Fly Leasing Ltd for $ 2.36 billion, including debt. In December, Carlyle’s flight arm also agreed to buy the Irish leasing company AMCK Aviation’s portfolio of aircraft.

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