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Dubai Aerospace signs $480m loan deal

Dubai Aerospace signs $480m loan deal

DAE became one of the world’s largest aircraft lessors after acquiring Dublin-based AWAS last year

Dubai Aerospace Enterprise (DAE), one of the world’s largest aircraft lessors, said on Monday it had signed a four-year loan deal for $480m.

DAE, a government-controlled company set up in 2006, has become one of the world’s largest aircraft lessors after acquiring Dublin-based AWAS last year.

The acquisition tripled the Dubai aircraft leasing and maintenance company’s portfolio to about 400 aircraft worth more than $14bn.

Read: Dubai Aerospace is now one of the world’s largest aircraft lessors

The $480m loan, which includes both conventional and Islamic finance tranches, has a so-called “accordion facility” allowing it to be increased to up to $800m.

With the loan, the company’s unsecured revolving credit facilities increase to between $1.125bn and $1.445bn, depending on final size of the latest deal, Firoz Tararpore, DAE’s chief executive, said in a statement.

“On a pro forma basis as of December 2017, if this facility is fully drawn and if the proceeds are used to pay down secured indebtedness, DAE’s percentage of unsecured debt would increase from 26 per cent to a range of 31-34 per cent.”

Last year, the company issued $2.3bn in senior bonds split across three tranches last year, partly to finance the AWAS acquisition.

Tarapore told Reuters in an interview last week that DAE was in talks to buy a near-record total of 400 jetliners from Airbus and Boeing in an order that could be worth more than $40bn at list prices.

Read: Dubai Aerospace in talks with Airbus, Boeing for 400-jet order

Al Ahli Bank of Kuwait coordinated the latest loan deal and was also the lead arranger and joint bookrunner together with First Abu Dhabi Bank, while Noor Bank joined the deal as lead arranger.

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