Aircraft lessor Avolon Holdings Ltd. AVOL is moving ahead with its planned initial public offering after talks with potential buyers collapsed over valuation disagreements.
Dublin-based Avolon in a regulatory filing said it plans to sell 13.6 million shares on the New York Stock Exchange at $21 to $23 apiece, a deal that would value the company, with debt, at about $6 billion.
The filing comes hours after China aerospace company AVIC Capital Co. Ltd. said that it is no longer in discussions with Avolon after the target's board rejected its bid. Avolon is currently owned by a consortium of private equity firms including Cinven Partners LLP, CVC Capital Partners and Oak Hill Capital Partners.
Avolon owns and leases a fleet of more than 120 jets to 48 airlines, with $6.6 billion worth of planes on order. The company is one of a number of lessors that have benefitted from a rush by airlines to refresh their fleets with more fuel efficient aircraft, and a growing desire by airlines to keep planes off the balance sheet.
Aircraft manufacturing giant Boeing Co. (BA) said it estimates that about half of narrowbody aircraft operated by airlines will be on lease instead of owned by 2020, compared to less than 2% in 1980 and just 24% in 2000.
The interest in leasing jets has created a rush of activity among leasing firms. Earlier this year, AerCap Holdings NV (AER) completed a $5.4 billion deal to acquire International Lease Finance Corp. from American International Group Inc. (AIG) , while the massive air leasing arm of General Electric Co. (GE) in October said it would buy IPO-candidate Milestone Aviation Group for $1.78 billion.