Abu Dhabi’s Waha to buy 20 pct stake in AerCap

(BestGrowthStock) – Abu Dhabi-listed Waha Capital PJSC (WAHA.AD: ) agreed to acquire a 20 percent stake in AerCap Holdings NV (AER.N: ) in a transaction valued at $380 million, making it one of the biggest shareholders in the Dutch aircraft leasing firm.

The deal will help the investment holding company gain a global presence at a time when the oil-rich emirate is aiming to become a regional center for manufacturing aircraft parts.

“With this stake, we diversify our risks in the aviation space and add value to Abu Dhabi to grow its business in the Middle East North Africa (MENA) region’s aviation side,” Salem al Noaimi, chief executive of Waha Capital, told a news conference.

Abu Dhabi aspires to build itself into a regional aerospace hub, while neighboring Dubai aims to become an aviation and logistics center, building what is planned to be the world’s largest airport.

Waha’s main institutional shareholder is Mubadala Development Co, whose unit Mubadala Aerospace will start making Airbus (EAD.PA: ) parts at its new facility by the fourth quarter.

The global airline industry has rebounded this year from the economic downturn that drained travel demand and caused airlines to slash capacity and halt orders.

Waha Capital will acquire about 29.8 million shares in AerCap for $105 million in cash, Waha’s 50 percent interest in their joint venture — AerVenture, and the transfer of a 40 percent interest in Waha’s 16-aircraft portfolio, AerCap said in a statement.

The transaction is scheduled to close by mid-November.

AerVenture, the joint venture between AerCap and Waha set up in 2009, will cease to exist with Waha’s stake buy in AerCap.

Waha, with a market value of $372.7 million, is also involved in real estate, maritime and financial sectors.

AerCap CEO Aengus Kelly said Waha provides a source of capital, and the deal would enable both companies to expand presence in the Middle East’s aircraft leasing, and mergers & acquisitions businesses.

AerCap, with assets worth $10 billion and equity totaling $2 billion as of June 2010, will take delivery of 20 aircraft worth $2 billion over the next 24 months, the CEO said.

Currently, AerCap has 340 planes, 100 engines and a large parts inventory in its portfolio of assets, Kelly said, adding the company grew its business to $10 billion, from $5 billion, in the last 24 months.

“We cannot see that level of growth but we will look at opportunities as we expand rapidly and add personnel here,” he said.

Waha’s 16-aircraft portfolio consists of Airbus A330 and Boeing 777 wide-body aircraft, Airbus A320, A321, Boeing 737 and Bombardier regional jet aircraft.

Under the terms of the agreement, AerCap will provide all management services for Waha’s aircraft portfolio in return for servicing fees, and will open a representative office in Abu Dhabi.

AerCap shares, which have gained about 13 percent in value since March 25 when it bought rival Genesis Lease Ltd, were up 2 percent at $12.87 on the New York Stock Exchange.

Shares of Waha closed down 1 percent at 0.80 dirhams on the Abu Dhabi bourse on Monday.

(Reporting by Bijoy Koyitty in Bangalore & Stanley Carvalho in Abu Dhabi; Editing by Unnikrishnan Nair)

Abu Dhabi’s Waha to buy 20 pct stake in AerCap