S&P gives BBB to AWAS Aviation term loan

Standard & Poor’s said it assigned its BBB issue-level rating to AWAS Aviation Capital Ltd.’s $350 million secured term loan due 2021. The recovery rating is 1, indicating an expectation that lenders would receive very high recovery (90%-100%) of principal in the event of a payment default.

The company will use the proceeds to finance 10 aircraft, including Boeing B737-800 and Airbus A320 aircraft.

The corporate credit rating on AWAS reflects its position as a major provider of aircraft leases and its diversified fleet and airline customer base, S&P said in a news release.

The rating also reflects the inherent risks of cyclical demand and lease rates for aircraft, the company’s substantial percentage of encumbered assets, and its ownership by funds managed by private equity firm Terra Firma Capital Partners Ltd. and the Canada Pension Plan Investment Board.

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