Citi Appointed Sole Mandated Arranger and Advisor by VEB-Leasing
OREANDA-NEWS.May 05, 2012. Citigroup announced it closed financing for a financial leasing agreement signed between VEB leasing, one of the top three financial lessors in Russia, and Aeroflot, Russia's largest airline company, to finance three A321-200 aircraft. Citi acted as a Sole Mandated Lead Arranger & Advisor, Joint Lender and Facility Agent. The arrangement is expected to facilitate Aeroflot's plans for fleet renewal and expansion of its domestic and international routes. The total catalog price for the three Airbus aircraft is USD 310.8 million, reported the press-centre of Citi.
The 10-year financing was guaranteed by three European Export Credit Agencies (ECAs): Euler Hermes (Germany), Coface (France) and ECGD (UK). This transaction is VEB-leasing’s first ECA-backed financing. In its advisory capacity, Citi assisted VEB-leasing throughout the ECA process and helped them obtain optimal ECA rating. The support of the Export Credit Agencies allowed VEB-leasing to close the deal on favourable conditions and offer competitive financing terms to Aeroflot.
RBS acted as a Joint Lender for the delivery of the first two aircraft, delivered in February-March 2012. VEB-leasing provided 15% downpayment financing. The third delivery will take place in August 2012.
Commenting on the transaction, Alex Taylor, Citi’s Head of Export and Agency Finance in Europe, Middle East and Africa said: "We are pleased to have been mandated by VEB-leasing for this landmark transaction. The closing of this deal in spite of challenging market conditions highlights Citi’s ability to leverage its global Export and Agency Finance network and facilitate the support of long-term credit guarantors to optimize funding structures for our clients."
Vyacheslav Solovyev, Chief Executive Officer of VEB-leasing said: "The strong support of European Export Credit Agencies for this transaction illustrates investors’ confidence in the Russian economy as well as in the soundness of VEB-leasing’s capabilities. This deal is an important milestone for us and we look forward to expanding our collaboration with Export Credit Agencies as well as leading international financial institutions such as Citi and RBS to further strengthen our aircraft leasing platform."
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