Fly Leasing — Merger or Acquisition (March 2018)
20 slides from Fly Leasing's merger presentation, Mar 1, 2018
Slide 1: February 2018 Fly Leasing
February 2018 fly leasing
Slide 2: Disclaimer
DISCLAIMER Forward-Looking Statements: This presentation contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “expects,” “intends,” “anticipates,” “plans,” “believes,” “
Slide 3: Disclaimer (forward-looking statements)
disclaimer Forward-Looking Statements: This presentation contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “expects,” “intends,” “anticipates,” “plans,” “believes,” “
Slide 4: Next Step to Driving Higher ROE and EPS
Next Step to Driving Higher ROE and Eps Transformed fleet by selling 72 aircraft with average age of 13.2 years since the start of 2015; Second youngest fleet among public lessors Fly has been patiently waiting for compelling risk-adjusted aircraft investments Reduced management fees and other expen
Slide 5: AirAsia Portfolio Acquisition
AirAsia Portfolio Acquisition Initial Portfolio Investments Future Sale-Leaseback Investments Orderbook Option Opportunity 34 A320-200 aircraft Leased to five AirAsia Group airlines in five different countries (1) 6.6 year weighted average age 6.2 year weighted average remaining lease term Seven air
Slide 6: Transaction Details
Transaction Details Under the terms of the sale and purchase agreement, AirAsia Berhad (“AAB”) will receive: $1.0 billion in cash (a combination of secured debt and unrestricted cash) 3,333,333 newly-issued FLY shares at $15.00 per share Represents a 29% premium to current share price (1) Significan
Slide 7: Strategic Rationale for Acquisition
SIGNIFICANT EMBEDDED AIRCRAFT VALUE IN ORDERBOOKFavorable pricing on orderbook of newest-generation narrowbodies that is sold out over 8 yearsNo pre-delivery payment requirement enhances returns and boosts liquidity profile ACCESS TO THE NEWEST TECHNOLOGYProforma for the transaction, 33% of assets w
Slide 8: High level proforma financial impact
High level proforma financial impact Annual Operating Lease Revenue Run-Rate EPS Unrestricted Cash at Closing t at Closing Equity at Closing Proforma Share Count $400+ million $2.50+ ~$145 million ~$3 billion ~$640 million(1) ~33 million
Slide 9: Proforma capital structure
Proforma capital structure Initial 34 aircraft acquired at closing will be financed with ~$580 million of committed staple financing and ~$90 million from FLY’s existing aircraft acquisition facility—FLY will temporarily increase its leverage to absorb the acquisition Planned reduction in leverage i
Slide 10: BBAM Partnership
BBAM is a world leader in aircraft management with over 200 airline relationships BBAM PARTNERSHIP DRIVES HIGHER RETURNS The acquisition is part of a larger transaction with participation of other BBAM-managed capital pools:Combined buying power of the BBAM franchise drives above-market investment r
Slide 11: Future Growth Opportunities
future Growth opportunities Estimated Delivery Timing Strong Pipeline of New Technology Aircraft
Slide 12: Future SLB Investments and Orderbook Option Opportunity
Future SLB Investments Orderbook Option Opportunity Aircraft 10 A320neo and 11 A321neo 20 A320neo/A321neo Lessees AirAsia Group airlines Naked Delivery (schedule below) 2019 – 2021 2020 – 2025 Lease Term 12 years - ATTRACTIVE ORDERBOOK FLY benefits from AirAsia’s preferential pricing No PDPs = Enhan
Slide 13: High-quality, young portfolio acquired at closing
High-quality, young portfolio acquired at closing, with the sale-leaseback NEO portfolio providing identified growth at attractive prices The orderbook options offer further growth and lessee diversification Catalyst for FLY’s transition to newest technology equipment Geographical Split(1) Asset Typ
Slide 14: Diverse Group of Global Lessees
DIVERSE GROUP OF GLOBAL LESSEES FLY Top 10 Lessees Initial Portfolio Proforma Top 10 Lessees (1) AirAsia Group (currently five different airlines in five countries) exposure will decline with a disciplined disposition strategy. FLY is targeting ~$150 million of AirAsia Group sales annually Pro forma
Slide 15: AirAsia Group Overview
AirAsia Group Overview AirAsia Group is the largest low-cost carrier in Asia and fourth largest airline in Asia in terms of passengers carried. The group is diversified across five countries and has access to independent capital—three of the entities are listed on local stock exchanges
Slide 16: Q&A
Q&A
Slide 17: Appendix
appendix
Slide 18: Initial Portfolio Lessees, Aircraft Age, Lease Maturity Profile
Initial Portfolio Lessees Aircraft Age Lease Maturity Profile Weighted Average Remaining Lease Term of 6.2 years Note: Percentages reflect average full-life current market value from three appraisers. Excludes engines.
Slide 19: Asset allocation snapshot
Asset allocation snapshot Initial Portfolio Future SLB Investments Orderbook Option Opportunity FLY Asset Allocation Incline Asset Allocation NBB Asset Allocation Note: Incline will acquire three additional narrowbody aircraft from AAB which are not included in the above asset allocation.
Slide 20: Share Issuance Governance Terms
SHARE ISSUANCE GOVERNANCE TERMS FLY Issuance: AAB will acquire 3.3 million newly-issued shares (10%) at $15.00 per shareOnex and BBAM management team will each acquire 666,667 newly-issued shares at $15.00 per share Lock-up Period AAB’s shares will be subject to lock-up arrangements through the deli