Asset-backed financing with a leading global institutional investor for an aviation-sector borrower with global locations.
LMF was mandated to structure and source institutional asset-backed financing for a ring-fenced portfolio of aviation infrastructure and operating assets across the Middle East and the United Kingdom. The perimeter combined fixed-base-operator infrastructure, long-dated airport concessions, special-mission aviation facilities and contracted operating cash flows.
The financing challenge was to underwrite assets located in several jurisdictions while presenting lenders with a coherent, secured credit perimeter. The operating businesses included mature aviation activities as well as expansion capex, requiring a structure that could finance both the existing asset base and future investment.
LMF structured a unitranche financing of ~$70m, comprising a day-one funded facility together with a dedicated capex line of ~$15m. The capex component was designed to support the expansion of aviation facilities under a long-term airport concession and was sized at approximately 60% loan-to-cost for the relevant development programme.
The financing perimeter was ring-fenced in a dedicated financing company holding the operating interests. Lender security was designed to include first-ranking security over the relevant assets, shares and cash flows of the financed entities.
The credit combined several forms of long-duration infrastructure exposure: major business-aviation centres operating under a multi-decade concession in the Middle East and the UK; and mission-critical airport properties supporting a long-standing special-mission aviation contract.
The portfolio also benefited from contracted or concession-based revenues, significant barriers to entry and diversified sources of operating cash flow. A substantial portion of receipts were denominated in several currencies, which was relevant to the currency selection and debt-servicing analysis of the debt facility.
LMF advised on the ring-fenced financing perimeter, unitranche structure, leverage, capex line, lender security and credit presentation. LMF also ran institutional lender outreach, managed commercial negotiations and due-diligence workstreams, and supported the transaction through documentation and execution.
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