Bohai Leasing enters into Exclusivity Agreement with Avolon to acquire 100% interest in Avolon for US$32 per share
August 10, 2015 08:44 AM Eastern Daylight Time
DUBLIN–(BUSINESS WIRE)–Avolon (NYSE: AVOL), the international aircraft leasing company, announces that today it has entered into an Exclusivity Agreement (the “Exclusivity Agreement”) with Bohai Leasing Co., Ltd. (SZSE: 000415) (“Bohai”) granting Bohai exclusivity to negotiate with Avolon until September 7, 2015 (the “Exclusivity Period”) with respect to the possible acquisition of 100% of the issued and outstanding common shares of Avolon at a price of US$32 per share (the “Transaction”). During the Exclusivity Period, Bohai and Avolon will endeavour to negotiate definitive agreements on terms previously discussed and accepted by the parties. Bohai’s offer is subject to completion of satisfactory and customary due diligence.
In connection with Bohai’s obligations under the Exclusivity Agreement, Bohai will make a good faith deposit of US$50 million into an escrow account within two business days, which amount will be in addition to the US$25 million currently held in escrow in connection with the cash tender offer made by Bohai on July 31, 2015 (the “Offer”), for an aggregate deposit of US$75 million. Avolon will be entitled to receive the US$75 million deposit in certain circumstances, including if Avolon is willing to execute definitive documents in connection with the Transaction and Bohai is unable or unwilling to do so. Upon execution of definitive documents in connection with the Transaction, the US$75 million deposit will be increased by Bohai to $250 million, payable to Avolon in the event the Transaction is not consummated under certain circumstances.
Pursuant to the Exclusivity Agreement, Avolon and Bohai will amend the Investment and Tender Offer Agreement, (the “Agreement”) dated July 14, 2015 between Avolon, Bohai and an indirect wholly owned subsidiary of Bohai, to extend the expiration time of the Offer to midnight at the end of the day on September 18, 2015.
If Bohai and Avolon enter into a binding agreement to consummate the Transaction prior to the consummation of the Offer, the Agreement and the Offer will be terminated.
Bravia Capital is serving as exclusive financial advisor to Bohai and Sidley Austin LLP is serving as Bohai’s legal counsel. J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC are serving as financial advisors to Avolon and Weil, Gotshal & Manges LLP is serving as Avolon’s legal counsel.
About Avolon Holdings Limited
Avolon is an international aircraft leasing company, headquartered in Ireland, with regional offices in China, Dubai, Singapore and the United States. Avolon provides aircraft leasing and lease management services. At June 30, 2015, Avolon had an owned, managed and committed fleet of 260 aircraft serving 56 customers in 33 countries. See: www.avolon.aero