It's official: SMBC Aviation Capital has pulled a $671.9 million lease securitization from the market.
Fitch Ratings said Tuesday it has withdrawn its preliminary ratings on Orbit Aircraft Leasing, which launched in late October. Fitch may assign the transaction expected ratings again in the future, following an updated analysis of the portfolio and the proposed structure.
Barclays had flagged the deal's demise in a report published Dec. 4.
Fitch planned to assign ‘A-‘ ratings to the class A-1 notes; ‘BBB’ ratings to the class B1 notes; and ‘BB’ ratings to the class C1 notes. All of the notes had expected terms of eight years a legal final maturity of November 2040.
The weighted average age of the leases pooled under Orbit Aircraft Leasing is 7.2 years,only slightly older than other recent transactions rated by Fitch in this asset class.
The pool was comprised of two types of aircraft: tier one aircraft, which generally have long expected remaining useful lives and tier 2 aircraft, which consists of midlife programs with established operator bases and often includes in-demand wide body aircraft as well.
Another sponsor, Castlelake, began marketing its securitization, Castlelake Aircraft Securitization Trust 2015-1, around the same time that Orbit was pulled from the primary line-up. The deal priced last week.
CLAS 2015-1 placed a total of $713 million of bonds: the single-A rated, class A notes pay a coupon rate of 4.703%, the triple-B rated, class B notes pay a coupon rate of 5.750%, and the single-B plus rated class C notes pay a coupon rate of 9.000%. Standard & Poor’s and Kroll Bond Ratings Agency assigned rating to the deal.
The deal is backed by aircraft that have a weighted average age of 15 years, older than the aircraft in the Orbit pool; but the pool is less levered relative to the pulled aircraft leasing deal. For example the senior notes issued from CLAS 2015-1 have a LTV of 60.2% compared to 66.82% LTV for the senior notes structured under Orbit.
Goldman Sachs is the lead structuring agent on both deals.