Aldus Aviation priced a $540 million aircraft lease securitization; its first ever, called ATLAS Series 2014-1.

The five-year class A notes, rated ‘A’ by Kroll Bond Rating Agency, yield 4.88%, according to an Interactive Data report.

Goldman Sachs and Deutsche Bank Securities are the lead managers.

The deal is backed entirely by leases on Embraer jets, which are a series of single-aisle medium-range twin-engine commercial jet aircraft produced by Brazilian aerospace conglomerate Embraer. There are a total of 30 leased to 10 airlines. This is atypical of such deals, which are more commonly backed primarily by Airbus- and Boeing-manufactured new technology aircraft and serviced by larger aircraft lessors.

The deal has another unusual feature, a standby servicer (ECC Leasing Company, the leasing arm of Embraer). 

The senior notes, which are structured with a loan-to-value ratio of 63%; and amortize on a straight-line basis over 16 years, yield more than a similar tranche of another recent deal backed by Embraer leases,   Jetscape Aviation’s Eagle I. The 4.6-year, single A rated, class A notes issued from that deal yield just 4.35%.  However the Jetscape deal is structured with a lower LTV of 52.3% and a shorter amortization schedule of four years. It is also backed by a larger pool of 1005 Embraer jets.

Bank of America Merrill Lynch is the sole structuring agent and lead manager on the Jetscape deal. DVB Capital Markets and Guggenheim Securities are joint bookrunners.

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