Thu, Jul 21, 2011
But Buyers Reportedly Lukewarm Based On Price, Fleet Age
International Leasing Finance Corporation is the largest company
in the world involved in the buying and leasing of commercial
jetliners, but ILFC parent AIG has made no secret of the fact that
it wants to divest itself of the aircraft leasing business, and
plans an IPO for roughly 25% of the company worth up to $2
billion.
But there is apparently some turbulence along the intended route
of flight; potential buyers look at the age of ILFC's fleet and the
potential for default by its customers, and have expressed only
lukewarm interest in the deal.
Reuters reports that while AIG has said for some time that
aircraft leasing is not among the core businesses for the
recently-bailed-out insurance giant, chairman Steve Miller says
prospective buyers say the company is over-valued at some $8
billion. Financing could also be a problem, Miller said, because
"no one's really sure where the economy is headed."
Steven Udvar-Hazy, the founder if ILFC and current CEO of Air
Lease, reportedly has said he would be interested in buying the
company back from AIG, but industry analysts seem to doubt that he
has the juice to pull off the deal.
The age of the company's fleet is also a potential issue, the
news service reports. The company has 933 planes, but retail values
are eroding as planemakers improve fuel efficiency in newer
models.
Analysts also say that there may also soon be a glut of aircraft
leasing companies on the market. To that end, they say, AIG would
do well to sell ILFC sooner rather than later.
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