Greenstone Aviation has appointed Deutsche Capital Securities to raise equity and debt. “Greenstone’s capital raise is going according to plan and we continue to be confident of our target capitalisation levels,” said John Slattery, CEO, Greenstone.
The recently-launched Dublin-based lessor plans to buy young, narrowbody aircraft that are on long-term lease. It will purchase assets through sale/leasebacks or small opportunistic portfolio acquisitions.

Multiple equity avenues available

At the moment, Greenstone is 100% owned by senior management. The deal with Deutsche Capital Securities should bring capitalisation in excess of $1bn. “There are multiple avenues of equity available both in private equity and capital markets open to Greenstone today,” Slattery said.

New air leasing companies have closed many deals in the past year, so will Greenstone find it difficult to catch up? Slattery doesn’t think so. He said that the big buyers of the past year will have spent a lot of their capital and that the time is ripe for a freshly capitalised company to enter the market.

“Some of the insurgents who have entered the market over the last 12 months have been exceptionally aggressive on pricing,” said Slattery. “They have been very successful in deploying their capital, but the output of that is that they have deployed a lot of that capital.”

Big demand

“The key of course is that the demand for aircraft sale/leaseback financing through 2013 continues to look very deep,” said Slattery. “In game theory, the first mover is sometimes not the optimal position on the runway.”
While companies such as Air Lease Corporation and Avolon have placed speculative orders, Slattery said that Greenstone will refrain from placing orders for now. “The market doesn’t need too many more speculative orders from lessors because the airlines have ordered aircraft themselves this time,” he said. “There is plenty of depth in the sale/leaseback market at the moment.”

If Greenstone decides to place aircraft orders directly with the manufacturers, they are unlikely to exceed more than 20% of the portfolio.

And job hunters should note that Greenstone will begin a recruitment drive for all departments this September, including: origination, operations, finance, technical and credit and business analysis.