Willis Lease Finance Corporation Announces Closing of $596.0 Million in Fixed Rate Notes

Rhea-AI Summary

Willis Lease Finance Corporation (NASDAQ: WLFC) has announced the successful closing of $596.0 million in fixed rate notes through its subsidiary Willis Engine Structured Trust VIII (WEST). The offering consists of $524 million Series A Notes with a 5.582% fixed coupon and $72 million Series B Notes with a 6.070% fixed coupon. The notes are secured by WEST's interests in 62 aircraft engines and two airframes. Both series have an expected maturity of approximately six years, with an expected weighted average life of 5.1 years and a final maturity of 25 years. The offering saw strong demand with subscription rates of 3.60x (gross) and 5.10x (avail) for Series A Notes, and 7.15x (gross) and 13.00x (avail) for Series B Notes. The notes were offered exclusively to qualified institutional buyers under Rule 144A and non-U.S. persons under Regulation S.

Positive

• Strong investor demand demonstrated by high subscription rates: 3.60x-5.10x for Series A and 7.15x-13.00x for Series B Notes
• Substantial financing secured ($596 million) backed by valuable aviation assets
• Diversified portfolio securing the notes with 62 aircraft engines and two airframes
• Structured financing provides long-term stability with 25-year final maturity

Negative

• Notes were issued slightly below par value at 99.99721% and 99.99711%
• Higher interest rates with fixed coupons of 5.582% and 6.070% represent significant cost of capital

Insights

Aviation Finance Specialist

WLFC secured $596M in notes with strong investor demand to acquire 64 aviation assets, strengthening its leasing portfolio.

Willis Lease Finance Corporation has successfully closed a $596 million fixed rate notes offering through its subsidiary Willis Engine Structured Trust VIII (WEST). This transaction represents a significant capital raise that strengthens WLFC's position as the leading lessor of commercial aircraft engines. The offering consisted of $524 million Series A Notes and $72 million Series B Notes, with fixed coupons of 5.582% and 6.070% respectively.

The standout feature of this transaction is the exceptional investor demand, with oversubscription rates of 3.60x (gross) and 5.10x (available) for Series A Notes and even higher at 7.15x (gross) and 13.00x (available) for Series B Notes. This robust demand suggests strong market confidence in WLFC's business model and the asset-backed aviation financing sector despite broader market volatilities.

The proceeds will fund the acquisition of 62 aircraft engines and two airframes, substantially expanding WLFC's leasable asset portfolio. With an expected weighted average life of 5.1 years but a final maturity of 25 years, the company has secured relatively long-term financing at fixed rates that protect against interest rate fluctuations. This structured financing approach aligns with industry best practices where the financing term roughly matches the economic utility period of the aviation assets being acquired.

For a specialized aviation lessor like WLFC, this transaction bolsters its core business model of providing essential equipment to airlines worldwide while potentially enhancing revenue stability through expanded leasing opportunities. The transaction's structure as a secured offering backed by specific aviation assets represents a continuation of WLFC's established financing strategy that effectively monetizes its expertise in aviation asset management.

COCONUT CREEK, Fla., June 18, 2025 (GLOBE NEWSWIRE) -- Willis Lease Finance Corporation (NASDAQ: WLFC) (“WLFC” or the “Company”), the leading lessor of commercial aircraft engines and global provider of aviation services, announced today that its wholly-owned subsidiary, Willis Engine Structured Trust VIII (“WEST”), has completed the previously announced offering of $524,000,000 in aggregate principal amount of Series A Fixed Rate Notes (the “Series A Notes”) and $72,000,000 in aggregate principal amount of Series B Fixed Rate Notes (the “Series B Notes” and, together with the Series A Notes, the “Notes”).

The Notes are secured by, among other things, WEST’s direct and indirect interests in a portfolio of 62 aircraft engines and two airframes, which WEST will acquire from WLFC or its other subsidiaries, pursuant to an asset purchase agreement. The final subscription was 3.60x (gross) and 5.10x (avail) on the Series A Notes and 7.15x (gross) and 13.00x (avail) on the Series B Notes.

The Series A Notes and Series B Notes have a fixed coupon of 5.582% and 6.070%, respectively, an expected maturity of approximately six years, an expected weighted average life (based on certain modeling assumptions) of 5.1 years and a final maturity of 25 years. The Series A Notes and Series B Notes were issued at a price of 99.99721% and 99.99711% of par, respectively.

The Notes offered by WEST have not been and will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), or any other securities laws of any jurisdiction, and may not be offered or sold in the United States or to U.S. persons (as defined in Regulation S under the Securities Act) absent registration or an applicable exemption from registration requirements. The Notes were offered only to persons reasonably believed to be “qualified institutional buyers” as defined in, and in reliance on, Rule 144A under the Securities Act and outside the United States to non-U.S. persons in accordance with Regulation S under the Securities Act.

This news release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of, the Notes in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the Securities Act or the securities laws of any such jurisdiction.

Willis Lease Finance Corporation

Willis Lease Finance Corporation (“WLFC”) leases large and regional spare commercial aircraft engines, auxiliary power units and aircraft to airlines, aircraft engine manufacturers and maintenance, repair, and overhaul providers worldwide. These leasing activities are integrated with engine and aircraft trading, engine lease pools and asset management services through Willis Asset Management Limited, as well as various end-of-life solutions for engines and aviation materials provided through Willis Aeronautical Services, Inc. Through Willis Engine Repair Center®, Jet Centre by Willis, and Willis Aviation Services Limited, the Company’s service offerings include Part 145 engine maintenance, aircraft line and base maintenance, aircraft disassembly, parking and storage, airport FBO and ground and cargo handling services. Willis Sustainable Fuels intends to develop, build and operate projects to help decarbonize aviation.

Except for historical information, the matters discussed in this press release contain forward-looking statements that involve risks and uncertainties. Do not unduly rely on forward-looking statements, which give only expectations about the future and are not guarantees. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update them to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which the forward-looking statement is based, except as required by law. Our actual results may differ materially from the results discussed in forward-looking statements. Factors that might cause such a difference include, but are not limited to: the effects on the airline industry and the global economy of events such as war, terrorist activity and the COVID-19 pandemic; changes in oil prices, rising inflation and other disruptions to world markets; trends in the airline industry and our ability to capitalize on those trends, including growth rates of markets and other economic factors; risks associated with owning and leasing jet engines and aircraft; our ability to successfully negotiate equipment purchases, sales and leases, to collect outstanding amounts due and to control costs and expenses; changes in interest rates and availability of capital, both to us and our customers; our ability to continue to meet changing customer demands; regulatory changes affecting airline operations, aircraft maintenance, accounting standards and taxes; the market value of engines and other assets in our portfolio; and risks detailed in the Company’s Annual Report on Form 10-K and other continuing and current reports filed with the Securities and Exchange Commission. It is advisable, however, to consult any further disclosures the Company makes on related subjects in such filings. These statements constitute the Company’s cautionary statements under the Private Securities Litigation Reform Act of 1995.

CONTACT:	Scott B. Flaherty Executive Vice President & Chief Financial Officer sflaherty@willislease.com 561.413.0112

FAQ

What is the total value of Willis Lease Finance Corporation's (WLFC) new fixed rate notes offering?

WLFC's total fixed rate notes offering amounts to $596.0 million, consisting of $524 million in Series A Notes and $72 million in Series B Notes.

What are the interest rates for WLFC's Series A and Series B Notes?

The Series A Notes have a fixed coupon rate of 5.582%, while the Series B Notes have a fixed coupon rate of 6.070%.

What assets are securing WLFC's $596 million notes offering?

The notes are secured by WEST's interests in a portfolio of 62 aircraft engines and two airframes.

What was the subscription rate for WLFC's Series A and B Notes?

Series A Notes had subscription rates of 3.60x (gross) and 5.10x (avail), while Series B Notes had subscription rates of 7.15x (gross) and 13.00x (avail).

What is the maturity period for WLFC's new fixed rate notes?

The notes have an expected maturity of approximately six years, with an expected weighted average life of 5.1 years and a final maturity of 25 years.