PIF's AviLease secures investment-grade ratings from Moody's, Fitch

30/04/2025 01:33 AST

Saudi Arabia's AviLease has secured investment-grade corporate credit ratings from Moody's and Fitch Ratings, as the global aircraft lessor continues to expand its portfolio and strategic role within the Kingdom's aviation sector.

Owned by Saudi Arabia's Public Investment Fund, AviLease announced it received a Baa2 rating with a stable outlook from Moody's and a BBB rating with a stable outlook from Fitch.

The two agencies highlighted AviLease's high-quality portfolio of new-technology aircraft with a strong credit mix, alongside its robust balance sheet and growth trajectory.

In an interview with Arab News, Edward O'Byrne, CEO of AviLease, said: "We just received Baa2 from Moody's and BBB from Fitch, which is two notches into the investment grade, and we got standalone investment grade from Moody's, which is quite remarkable given the vintage of the company. We're less than three years old."

He continued: "We're now part of a very small group of leasing companies - ten altogether, with us included - and on the aviation side, on the airline side, 11 airlines are IG-rated. So it's a very, very small group."

O'Byrne emphasized that the new ratings will give AviLease greater access to international markets, allowing it to tap into capital markets, lower the cost of financing, and de-risk its liability structure.

"This allows us to not only issue debt here in Saudi Arabia, but globally, and that means we can go to the US capital markets, but also Japan, and also the sukuk market if we want to," he said.

O'Byrne added: "That gives us a lot of flexibility and, obviously, the ability to lower our spreads, our cost of financing. In reality, we're about two years ahead of our business plan already."

He noted that the company is expected to become one of the largest players in the global leasing industry by 2030.

O'Byrne also pointed to industry-wide challenges, particularly around aircraft supply.

"We basically only have aircraft from either Airbus or Boeing. They represent about 90 plus percent of the production globally," he said. "If either or both of those manufacturers can't produce at scale, then we have a problem."

The global aviation sector, he noted, has yet to return to pre-2018 production levels.

"We have roughly 3,500 aircraft that have not been produced, they are missing in the industry," O'Byrne said.

He added that, as an aircraft owner managing a fleet of around 200 planes, the company benefits from limited supply, which increases demand for its aircraft.

The company is also actively exploring sustainable aviation fuel initiatives in Saudi Arabia.

"We're also exploring critical e-fuels, and in Saudi Arabia, we have a unique opportunity to produce direct fuel from sun and wind power," O'Byrne said.

The ratings also recognize AviLease's strategic role in supporting PIF's aviation sector initiatives under Saudi Arabia's Vision 2030.

"The ratings open the door for even greater financial flexibility, as we will be able to tap into the unsecured debt capital markets," said O'Byrne, in a press statement.

He noted that AviLease has quickly joined the ranks of a distinguished group of aircraft lessors in the industry.

Fahad Al-Saif, chairman of AviLease, said: "These ratings will enable AviLease to access global capital markets to finance its business strategies, positioning itself at the forefront of the aircraft leasing industry, in complete alignment with the National Aviation Strategy and Saudi Arabia's Vision 2030."