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Deals

Maples Group Assists Stonepeak on the Aviation Sector's First Broadly Syndicated Aircraft Loan Securitisation

24 Nov 2021

The Maples Group is pleased to have assisted Stonepeak, a leading alternative investment firm specialising in infrastructure and real assets, on its inaugural aircraft loan securitisation transaction, SALT 2021-1, which closed on 18 October 2021. Notably, the transaction is the aviation sector's first broadly syndicated aircraft loan securitisation and its success looks set to open up another new channel of financing for the sector.

SALT 2021-1 featured the issue of US$893.5 million of notes by SALT 2021-1 Trust (the "Issuer"), making it the biggest US aviation securitisation since the start of the COVID-19 pandemic. The transaction utilised elements of a traditional aircraft ABS structure and rating methodology, but also adopted CLO technology to offer investors enhanced structural features and protections. The notes are backed by a portfolio of loans secured by 156 aircraft on lease to 45 lessees across 29 jurisdictions, none of which are more than 16 years old. The loan portfolio is comprised of 26 facilities containing 116 loans to 15 obligors, including both aircraft leasing companies and airlines.

SALT 2021-1 represented the successful refinancing of the first joint investment made by Stonepeak and Bellinger Asset Management ("Bellinger") since the launch of the firms' aviation investment platform in May 2021. Funds managed by affiliates of Stonepeak and Bellinger retain the equity in the transaction, and an affiliate of Bellinger acts as servicer for the loan portfolio.

The Maples Group's law firm, Maples and Calder, provided Cayman Islands and Irish legal advice to Stonepeak on the transaction, following its role advising on the investment platform set up and acquisition of the loan portfolio. The Group's fiduciary services team provided director and administration services to the Irish issuer in the structure. The cross-jurisdictional legal team was led by Donna Ager, Partner and head of the European Aviation practice and Jonathon Meloy, Partner and co-head of the Cayman Islands Asset Finance practice. The deal team also featured Patrick Rosenfeld, Partner in the Cayman Islands investment funds group; Anthony Philp, Partner in the Cayman Islands finance group; William Fogarty, Partner in the Dublin tax group; and Associates Eoin O'Leary, Karla Macken, Ed Rhind and Krista-Lynn Wight. The Group's fiduciary team comprised Vice Presidents Patrick Kenny and Ciaran Madigan.

Commenting on the transaction, Jonathon Meloy said, "We are delighted to have supported Stonepeak on this landmark transaction, which is a first for the aviation industry. The Maples Group was perfectly positioned to assemble a multi-disciplinary team of aviation finance, investment funds, structured finance and tax specialists across our Irish and Cayman Islands offices to advise on this innovative structure, which combined elements of a traditional aircraft ABS with CLO technology in a true public offering."

Allen & Overy acted as legal counsel to the Issuer and Milbank acted as legal counsel to the co-lead initial purchasers.

The Maples Group's global aviation team is uniquely placed to support fund investment, ABS and CLO products in the aviation space and continues to be selected to support on market-leading transactions. Among other ABS transactions this year, the team assisted Falko Regional Aircraft Limited on its inaugural aircraft securitisation (ABS) financing transaction, Regional 2021-1 and SKY Leasing with its impressive debut aircraft ABS transaction, SLAM 2021-1.


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