Avation

Avation PLC is a commercial passenger aircraft lessor headquartered in Singapore and listed on the Main Market of the London Stock Exchange under the ticker AVAP. Rather than operating a scheduled airline service under its own brand, Avation acquires aircraft and leases them to airline customers in different markets. Its business therefore sits within aviation finance and fleet management, with activity spanning regional turboprop aircraft as well as narrow-body and wide-body passenger jets. The company was established in 2006 by Jeff Chatfield. Its formation was connected to Skywest Airlines Ltd, which created Avation through a special dividend: shares in the new company were distributed in specie to the then shareholders of Skywest Airlines. Avation initially concentrated on narrow-body jet leasing, placing Fokker 100 and Airbus A320/A321 aircraft with Skywest and other airline customers. This origin gave the company an early operating relationship with an airline while allowing it to develop as an independent aircraft owner and lessor. A significant change in the portfolio occurred in 2011, when Avation placed its first order for ATR 72 aircraft. The turboprops were leased to Skywest Airlines and helped establish a longer-term emphasis on regional aircraft. On 11 April 2013, Virgin Australia Holdings completed its acquisition of Skywest Airlines. Following that transaction, Avation continued to operate independently and expanded its aircraft portfolio organically rather than becoming part of Virgin Australia’s airline business. Avation’s growth has been supported by aircraft orders, including orders with ATR, and by the addition of narrow-body and wide-body aircraft alongside its regional turboprop fleet. The company has funded fleet acquisitions through a combination of equity and bond issuance on the London Stock Exchange. Its commercial model depends on matching aircraft assets with airline demand, structuring leases, maintaining access to aviation finance, and managing the residual and credit risks associated with aircraft ownership. Sustainability-linked aviation finance became a notable part of Avation’s public profile in 2019. In December of that year, the company arranged what it described as the world’s first certified aircraft green loan for a new commercial aircraft, with Deutsche Bank. The sustainability indicator was independently verified by Vigeo Eiris. The financing related to a new aircraft and was presented as an innovation in funding aviation assets rather than as a change from aircraft leasing to airline operations. Avation has also received industry recognition for its financing and leasing transactions. In 2019, Airfinance Journal recognized Avation and Air Baltic with its Operating Lease Deal of the Year award for 2018. In January 2020, Avation received Aviation 100’s European Editor’s Deal of the Year for Innovation 2019 for financing new ATR 72-600 aircraft for Braathens Regional Airlines using the first aviation green loan. These recognitions reflect the company’s role as an aircraft lessor and aviation-finance participant. Its brand positioning is consequently based on fleet ownership, leasing expertise, international airline relationships, and structured funding rather than consumer-facing airline marketing.

Avation was founded in 2006 by Jeff Chatfield through a corporate transaction associated with Skywest Airlines Ltd. The new company was created via a special dividend, with shares distributed in specie to the then shareholders of Skywest Airlines. This structure separated an aircraft-leasing business from the airline-related shareholder base while giving Avation an immediate connection to commercial aviation. In its early years, Avation operated primarily as a narrow-body jet lessor. It leased Fokker 100 and Airbus A320/A321 aircraft to Skywest Airlines and to other airline customers. The initial portfolio reflected the company’s origins and its focus on placing aircraft with established commercial operators rather than running passenger services itself. The company broadened its fleet strategy in 2011 by ordering its first ATR 72 aircraft. These aircraft were leased to Skywest Airlines and marked the beginning of a more substantial turboprop presence. Regional turboprops became an important component of Avation’s development because they serve shorter routes and regional networks that require smaller-capacity aircraft than conventional narrow-body jets. On 11 April 2013, Virgin Australia Holdings completed its acquisition of 100 percent of Skywest Airlines Ltd. Avation remained independent after the acquisition and continued to expand its aircraft-leasing business separately from Virgin Australia. The company subsequently developed its portfolio through further turboprop orders with ATR and by adding narrow-body and wide-body aircraft. This produced a broader fleet profile and allowed Avation to serve airline customers with different network and capacity requirements. To finance aircraft acquisitions and portfolio growth, Avation issued bonds and shares on the London Stock Exchange. Its public listing provided access to capital markets while its leasing model required the company to combine equity, debt, aircraft orders, and customer lease contracts. The company’s business consequently involves both aircraft asset management and aviation finance, with the value of its fleet and the credit quality of airline customers central to its operations. A notable financing milestone occurred in December 2019, when Avation procured a certified aircraft green loan from Deutsche Bank for a new commercial aircraft. The company described this as the world’s first certified aircraft green loan. The sustainability indicator associated with the financing was independently verified by Vigeo Eiris. This transaction placed Avation among the aviation companies experimenting with sustainability-linked financing for aircraft assets. Avation’s transaction expertise was also recognized by industry publications. In May 2019, Airfinance Journal awarded Avation and Air Baltic the Operating Lease Deal of the Year for 2018. In January 2020, Avation was awarded Aviation 100’s European Editor’s Deal of the Year for Innovation 2019. The latter recognition related to financing new ATR 72-600 aircraft for Braathens Regional Airlines through the aviation green loan structure. Avation is headquartered in Singapore and remains publicly owned and listed on the London Stock Exchange. Its wholly owned subsidiary, Capital Lease Aviation Limited, forms part of the group structure. The company’s continuing identity is that of an international commercial aircraft lessor: it owns or finances passenger aircraft, leases them to airline customers, and uses capital-market and bank financing to support fleet development.

• 2020

  Aviation 100 innovation award

  [1]Avationen.wikipedia.org

  Avation received Aviation 100’s European Editor’s Deal of the Year for Innovation 2019 for ATR 72-600 financing for Braathens Regional Airlines.

• 2019

  Certified aircraft green loan

  [1]Avationen.wikipedia.org

  Avation procured a certified green loan from Deutsche Bank for a new commercial aircraft, with the sustainability indicator independently verified by Vigeo Eiris.

• 2019

  Operating Lease Deal of the Year

  [1]Avationen.wikipedia.org

  Airfinance Journal recognized Avation and Air Baltic with its Operating Lease Deal of the Year award for 2018.

• 2013

  Virgin Australia completes Skywest acquisition

  [1]Avationen.wikipedia.org

  Virgin Australia Holdings completed its acquisition of Skywest Airlines Ltd. Avation continued to develop as an independent aircraft lessor after the transaction.

• 2011

  First ATR 72 order

  [1]Avationen.wikipedia.org

  Avation ordered its first ATR 72 aircraft and leased the aircraft to Skywest Airlines, expanding beyond its initial narrow-body jet focus.

• 2006

  Avation is founded

  [1]Avationen.wikipedia.org

  Jeff Chatfield founded Avation through a special-dividend transaction associated with Skywest Airlines Ltd, with shares distributed to the then Skywest shareholders.

An independent international aircraft lessor focused on owning and financing commercial passenger aircraft for airline customers, with a portfolio that includes regional turboprops, narrow-body jets, and wide-body aircraft.

• Regional turboprop aircraft leasing · 2011

  ATR 72

  The ATR 72 became a significant aircraft type in Avation’s portfolio after the company placed its first ATR order in 2011. Avation leases these regional turboprops to airline customers operating shorter routes and regional networks. The aircraft are part of the company’s strategy of serving capacity segments below conventional narrow-body jets.

• New-generation regional turboprop aircraft leasing

  ATR 72-600

  Avation has financed new ATR 72-600 aircraft for airline customers, including Braathens Regional Airlines. The type is associated with the company’s regional-aircraft leasing and aviation-finance activities and was central to the transaction recognized by Aviation 100 for innovation.

• Narrow-body passenger aircraft leasing · 2006

  Airbus A320/A321

  Airbus A320 and A321 aircraft formed part of Avation’s original narrow-body jet leasing activity. The company placed these aircraft with Skywest Airlines and other airline customers as it established its aircraft-owner and lessor business.

• Narrow-body passenger aircraft leasing · 2006

  Fokker 100

  Fokker 100 aircraft were among the aircraft types leased by Avation during its early period as a narrow-body jet lessor. They illustrate the company’s initial focus on placing passenger aircraft with airline operators.

• 2019

  Adoption of certified aircraft green-loan financingOther

  Background

  Aircraft lessors and other aviation companies were exploring financing structures that incorporated environmental criteria.

  Action taken

  Avation procured a certified green loan from Deutsche Bank for a new commercial aircraft, with the sustainability indicator independently verified by Vigeo Eiris.

  Aftermath

  The transaction was presented as the world’s first certified aircraft green loan and later contributed to industry recognition for innovation in aviation finance.

  Source

• 2011

  Expansion into ATR regional aircraftStrategy

  Background

  Avation initially focused on narrow-body jet leasing but sought to broaden its aircraft portfolio and airline-customer reach.

  Action taken

  The company ordered its first ATR 72 aircraft and leased them to Skywest Airlines.

  Aftermath

  The order established turboprop leasing as an important element of Avation’s subsequent fleet development.

  Source

• 2020

  Avation receives Aviation 100 innovation award[1]Avationen.wikipedia.org

  Other

  Avation received Aviation 100’s European Editor’s Deal of the Year for Innovation 2019 for financing new ATR 72-600 aircraft for Braathens Regional Airlines through an aviation green loan.

• 2019

  Avation and Air Baltic receive Operating Lease Deal of the Year recognition[1]Avationen.wikipedia.org

  Other

  Airfinance Journal recognized Avation together with Air Baltic for the Operating Lease Deal of the Year 2018.

• 2019

  Avation arranges certified green loan for a new commercial aircraft[1]Avationen.wikipedia.org

  Other

  Avation procured a certified aircraft green loan from Deutsche Bank for a new commercial aircraft. The sustainability indicator was independently verified by Vigeo Eiris.

1. 1Avationen.wikipedia.org