Terra Firma, CPPIB sell Awas to Dubai Aerospace

Financial details of the transaction remain undisclosed, though Reuters recently reported the vendors were hoping to achieve an enterprise valuation in the region of $7bn for the company. However, unquote" understands the deal value exceded the $7.5bn figure at which Awas's aircraft assets are currently valued.

The sale comes two years after Awas sold a portfolio of 84 aircraft to Macquarie for a total consideration of $4bn. At the time of the partial exit, Terra Firma held a 75% stake in the business, with the remaining 25% stake owned by CPPIB.

Awas now has a fleet of 214 aircraft, with a further 23 on order. Under the vendors' tenure, the company has expanded its fleet via sale-leaseback transactions with airlines and secondary market aircraft purchases. It also bolted on Pegasus Aviation Finance Company from Oaktree Capital Management in May 2007, in a $5.2bn deal.

Since Terra Firma's acquisition, the book value of Awas's fleet has increased from $2.3bn to $7.5bn. Prior to Awas's sale of 84 aircraft to Macquarie, the fleet had a value of $10.7bn. EBITDA has also risen from $256m to $1bn during the tenure of Terra Firma and CPPIB.

The transaction is expected to complete in Q3 2017, subject to regulatory approval.

Previous funding
Terra Firma acquired AWAS for €5.677bn from Morgan Stanley in January 2006, with capital drawn from its TFCP III fund.

Company
Founded in 1985 and headquartered in Dublin, Awas is a commercial aircraft leasing company. It has a client base of 87 airlines in around 45 countries.

Awas generated a turnover of $1.2bn in 2015, according to publicly available documents, with EBITDA of $1bn.

People
Terra Firma – Guy Hands (chairperson, chief investment officer).
Canada Pension Plan Investment Board – Ryan Selwood (managing director, head of direct private equity).

Advisers
Equity – Goldman Sachs (corporate finance); Milbank (legal).

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