Bohai Leasing (000415.SZ) subsidiary Avolon intends to acquire 100% equity stake in aircraft leasing company CAL.

Bohai Leasing (000415.SZ) announced that, in order to further strengthen the company's market share and competitiveness in the global aircraft leasing industry, and increase the company's profitability, its controlling subsidiary Avolon plans to acquire 100% equity of aircraft leasing company CAL through its wholly-owned subsidiary AAHL. On September 12, 2024 (New York time), Avolon and its wholly-owned subsidiary AAHL signed a Purchase and Sale Agreement and related annex agreements with Castlelake Aviation LLC ("the seller") and related parties. Avolon plans to purchase 100% equity of CAL by paying in cash. The final transaction price will be determined based on the net assets of the target company as of the day before the closing date (prepared in accordance with US GAAP), minus the adjustment amount calculated according to the Purchase and Sale Agreement. Calculated based on CAL's net asset book value of $1.416 billion as of March 31, 2024, and subtracting assets such as related aircraft to be divested before closing and corresponding liabilities, as well as cash exceeding $38 million, the net asset book value of the target company to be acquired is $1.241 billion. After subtracting the adjustment amount calculated according to the Purchase and Sale Agreement, the purchase price for 100% equity of CAL is approximately $1.221 billion (equivalent to approximately RMB 8.673 billion at the exchange rate of 1:7.1030). The funding source for this acquisition is Avolon's own funds or self-raised funds. This transaction is beneficial for leveraging the scale effect and synergy effect of the existing aircraft leasing business and the target company's aircraft leasing business, utilizing Avolon's extensive financing channels and cost advantages, enhancing the profit level of the target company's aircraft assets, strengthening the company's sustainable profitability, enhancing the relationship with airline customers, and increasing the company's market share and competitiveness in the global aircraft leasing industry. After the completion of this transaction, Avolon's own, managed, and ordered aircraft fleet will reach 1,147 aircraft, including 647 owned aircraft, 40 managed aircraft, and 460 ordered aircraft, with an average remaining lease term of approximately 7.2 years and an average age of approximately 6.1 years, continuing to consolidate its position as the world's second-largest aircraft leasing company, providing aircraft leasing services to 144 airline customers in 64 countries and regions worldwide. (calculated based on Avolon's fleet situation as of June 30, 2024)