S&P affirms Avolon Holdings

S&P said it affirmed all of its ratings on Avolon Holdings Ltd., including the BB+ issuer credit rating.

The outlook is stable.

The agency said the affirmation reflects a view that Avolon's stand-alone credit profile will not be affected by the proposed investment by ORIX Corp. (A-/stable/--), through its wholly owned subsidiary ORIX Aviation Systems, and the revision of its governance structure.

Under the proposed transaction, ORIX will invest $2.2 billion for a 30% stake in Avolon.

Avolon is currently a wholly owned subsidiary of Bohai Capital Holding Co. Ltd., which is itself 53% owned by the HNA Group.

“Our ratings on Avolon previously incorporated our assessment of the company as an insulated subsidiary of Bohai and our assessment of Bohai as de-linked from HNA,” S&P said in a news release.

“However, with the proposed investment by ORIX and the related revisions to the company's governance structure (both of which we view favorably), we would now assess Avolon as de-linked from Bohai.”

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