ORIX Corporation to acquire 30% of Avolon Holdings Limited

 ORIX  Corporation  (“ORIX”)  announced  today  that,  via  its  group company in Ireland, ORIX Aviation Systems Limited (“ORIX Aviation”), which is not only an established aircraft leasing and trading company but also a leading S&P ranked aircraft asset manager, has signed an agreement  to acquire 30% of  the outstanding shares of Ireland‐based Avolon Holdings Limited (“Avolon”),  which  is  a  leading  global  aircraft  leasing  company.  The  acquisition  is  expected  to  be completed after the necessary approvals and/or licenses are obtained. 

1. Reason for the acquisition of the shares 
ORIX  entered  into  the  aircraft  finance  lease  business  in  1978  and  has  accumulated  aviation experience and knowledge over the past 40 years. In 1991, it established ORIX Aviation in Ireland to get a foothold in the aircraft operating lease business. Since formation ORIX Aviation has grown to 
be a major aircraft lessor, asset manager and trading company. In addition to the leasing of its own portfolio aircraft, it has developed a unique asset management platform that attracts both domestic Japanese and international investors, and is the only S&P ranked aircraft lease servicer worldwide 
with  USD10  billion  of  aircraft  assets  under  management.  At  present,  ORIX  Aviation  owns  and manages over 200 aircraft and leases them to more than 70 airlines located in over 30 countries. ORIX Aviation is headquartered in Dublin with an office in Hong Kong. 

Avolon  is  a  leading  global  aircraft  leasing  company  focused  on  acquiring,  managing,  leasing  and selling commercial aircraft. Avolon is headquartered in Ireland, with offices in the United States, the UAE, Singapore, Hong Kong and China. In May 2010, Avolon was launched by an experienced team of aircraft leasing and  financing professionals, and operated as a private company until the initial public offering of the business in December 2014. Avolon operated as a public company listed on the 
New York Stock Exchange under the symbol “AVOL” before being acquired by Bohai in January 2016. 

Subsequently, Avolon became the core aircraft leasing brand for Bohai and its parent, HNA Group. In April 2017, Avolon acquired all of the issued and outstanding equity interest of C2, the commercial aircraft leasing business of CIT Group.   

Avolon focuses on acquiring and maintaining a portfolio of young, modern, fuel efficient commercial aircraft while seeking  to maximize long‐term earnings growth and cash  flow generation and drive attractive  risk‐adjusted  returns  through  the aviation industry cycle. The business is operated on a 
global basis, maintaining a diverse  fleet of aircraft provided to airlines across different geographic regions. As of  June 30, 2018, Avolon’s owned managed and committed portfolio consisted of 890 aircraft, including 532 owned aircraft, 30 managed aircraft and 328 committed aircraft. 

The worldwide demand for aircraft is projected to increase due to the rise in LCCs and the increase in  global  passenger  traffic  also  in  line  with  the  rapid  economic  growth  of  markets,  in  particular emerging markets. The number of the worldwide commercial aircraft fleet is expected to rise from 24,400 in 2017 to 48,540 in 2037, and passenger traffic is expected to grow by an average of 4.7% per year*. 

Airline demand for aircraft leasing by airlines is projected to increase with the objective of achieving  flexible  fleet  planning  and  financing.  Currently,  approximately  40%  of  the  commercial  aircraft  in operation worldwide are financed by operating leases. More growth is expected, and many forecasts 
expect this ratio to reach almost 50% in the future.   

By virtue of the acquisition of the shares of Avolon, ORIX aims to achieve sustainable long term growth of its business by way of strengthening its access to the manufacturer order positions that Avolon holds and also  further expanding its aircraft leasing  business investment universe. ORIX  strives  to further increase its presence in the global aircraft leasing market via its collaboration with Avolon and by  utilizing  of  the  considerable  experience  and  knowledge  that ORIX  has  gained  through  its  long 
involvement in both aircraft leasing and financing.   

About ORIX:
ORIX Corporation (TSE: 8591; NYSE: IX) is an opportunistic, diversified, innovation‐driven global powerhouse with a proven track record of profitability. Established in 1964, ORIX at present operates a diverse portfolio of businesses in the operations, financial services, and investment spaces. ORIX’s highly complementary business activities span industries including: energy, private equity, infrastructure, automotive, ship and aircraft, real estate and retail financial services. ORIX has also spread its business globally by establishing locations in a total of 38 countries and regions across the world. Through its business activities, ORIX has long been committed to corporate citizenship and environmental sustainability

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