Ireland-based lender Avolon has completed its acquisition of fellow lender Castlelake Aviation, a deal first announced last year.
Avolon plans to acquire 106 aircraft from its lease portfolio.
The company will also take over orders and contracts for 10 additional aircraft, which it calls “new technology” models.
Avolon's fleet will expand to 664 owned and managed aircraft. We also plan to work on 465.
At the time the deal was first announced, Avolon said Castle Lake's portfolio (valued at $5 billion) consisted of 118 aircraft, 68% of which were narrowbodies.
The portfolio has up to $3.3 billion in transferable debt, and Avolon added that it will fund the balance with its own liquidity sources (totaling more than $8 billion at the time).
The lender said its high liquidity and balance sheet strength made the transaction possible.
Avolon acquired 45 aircraft and sold 55 aircraft last year, and including the Castle Lake contract, had an owned, managed or committed portfolio of 1,129 aircraft at the end of 2024.
Following increases in lease rates over the past two years, we expect them to remain high this year as airlines address supply chain issues by extending leases on their current fleets.
“Acquiring aircraft for expansion and fleet replacement will continue to be a major challenge in 2025, and new aircraft slots will continue to be sold out in 2030 and beyond,” the report said.
Avolon expects to deliver more than 1,400 new aircraft this year, but expects Airbus and Boeing to “continue to struggle” to overcome production ramp-ups.
“Lenders currently have more new aircraft supply by 2030 than Boeing and Airbus combined,” the paper claims.
“Order books are consolidating around a small number of lenders, who will benefit from higher order revenues as airlines with fewer orders compete for scarce aircraft.”
