Singapore’s Avation seeks consents to extend maturity of 6½% notes, amend bond terms

By Rebecca Melvin

New York, Feb. 9 – Avation plc announced that it has reached agreement with 76% of the holders of its 6½% senior notes due May 15, 2021 to extend the maturity of the bonds by 5.5 years, according to a company announcement.

The company is seeking to extend the maturity of its $342.6 million of 6½% notes, issued by Avation Capital SA, to Oct. 31, 2026. The consent solicitation is expected to begin by Feb. 19.

Other terms of the transaction include a cash coupon to include an additional 2½% payment-in-kind or an additional 1¾% cash coupon.

There is also an early consent fee of up to 75 basis points, including 50 bps up front and a subsequent 25 bps payable later, and a late consent fee of 25 bps.

Bondholders are to receive 6 million warrants to subscribe for ordinary shares exercisable to Oct. 31, 2026 at an exercise price of 114.5 pence per share.

The notes will be callable at 103 for a year and a half, and then at 106 until Oct. 31, 2024, at 104.5 until Oct. 31, 2025, and then at par thereafter.

In addition, there will be “general strengthening” of the notes’ covenants and additional guarantees of security.

The transaction is aimed at improving the company’s capital structure as it grapples with the business impact of the Covid-19 pandemic, according to the company.

PJT Partners is adviser to the company, and Perella Weinberg UK Ltd. is adviser to the bondholder committee.

Avation is a Singapore-based aircraft lessor.

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