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Clifford Chance advises MC Aviation Partners on the establishment of an aircraft leasing joint venture with Cheung Kong and the related sale of 15 aircraft for US$ 730 million

3 March 2015

Clifford Chance advises MC Aviation Partners on the establishment of an aircraft leasing joint venture with Cheung Kong and the related sale of 15 aircraft for US$ 730 million

A cross-border team from international law firm Clifford Chance has advised MC Aviation Partners, Inc. ("MCAP"), the aircraft leasing and trading arm of Mitsubishi Corporation, on the formation of a joint venture dedicated to aircraft leasing ("JV") with Cheung Kong ("CK"), one of Hong Kong's leading multinational conglomerates. The JV is held 40% by MCAP and 60% by CK.

As part of the transaction, MCAP sold a portfolio of 15 aircraft owned by MCAP to the JV for US$ 730 million. MCAP will act as exclusive servicer to JV in respect of these aircraft.

The portfolio consists of eight Airbus A320-200 aircraft, five Boeing 737-800 aircraft, one Boeing 787-8 aircraft and one Boeing 777-300ER aircraft.  The average remaining lease term of the aircraft is 9 years and the average age of the aircraft is 1.8 years. 

In addition, Clifford Chance has acted on behalf of the JV in negotiating a US$515 million loan facility with DV Bank SE and BNP Paribas (Singapore Branch) as part of the financing of the acquisition of the portfolio by the JV. 

Hong Kong partner Paul Greenwell advised on the aircraft sale with associates Benjamin Fisher and Hetty Lam. Advice on the debt financing was provided by London partner Ranbir Hunjan with support from senior associate Paul Carrington and associate Mallory Carroll. London partner Joel Ziff and senior associate Grace Yuen and associate Rachel Swan advised on the formation of the JV.