S&P affirms AWAS amended loan

Standard & Poor’s said it affirmed the BBB rating on AWAS Aviation Capital Ltd.’s $235 million secured term loan due 2018.

The 1 recovery rating is unchanged, indicating 90% to 100% expected default recovery.

This term loan amends and extends the company’s existing term loan, which matures in 2016, S&P said.

The corporate credit rating on AWAS reflects its position as a medium-sized provider of aircraft leases and its diversified fleet and airline customer base, the agency said.

The rating also considers the inherent cyclicality of 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, S&P said.

Over the past year, AWAS used the proceeds from the sale of about 90 of its aircraft to pay a dividend to its owners, the agency said.

The company’s credit metrics declined in 2015 because the company’s aircraft sales reduced its earnings and cash flow, S&P said.

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