Archives: July 2014

S&P Announces Rating on AFC Led Loan for AWAS

AWAS has come to market with a $350 million loan.

Aviation Finance is the lead arranger on the financing. Proceeds from the loan, which is due in 2021, will be used to finance 10 737-800 and Airbus A320 aircraft.

Standard & Poor’s Ratings Services assigned its “BBB” rating to the loan with a recovery rating of “1” as there is a “very high” chance of recovery of principal in the event of a payment default.
The ratings agency issued a stable outlook on the loan, reflecting its view that AWAS will add incremental debt through 2015 to fund capital spending for new aircraft deliveries, with increased funds from operations due to higher earnings, cash flow related to the additional aircraft, and modestly improving lease rates.
It expects AWAS’ credit metrics to remain relatively consistent, with funds from operations to debt of about 10% and debt to capital in the mid-70% area.