Guggenheim Aviation Partners Announces $1.595B Aircraft Sale To Aircastle Limited

Chicago, IL - Guggenheim Aviation Partners, LLC (GAP), an affiliate of Guggenheim Partners, LLC, recently announced that certain subsidiaries of Guggenheim Aviation Investment Fund, LP (GAIF), a $277M fund which is managed by GAP, agreed to sell 38 aircraft valued at approximately $1.595B to Aircastle Limited, a global aviation company.

GAIF, established in February 2005, was created to invest in commercial jet aircraft and engines with a particular focus on the freight market. Aircastle is purchasing 38 aircraft, including 12 freighters: four Boeing model 747-400ERF freighters to be delivered new from the manufacturer, seven Boeing model 747-400 aircraft converted or to be converted to freighter specification, and one MD11F. The remaining 26 aircraft are passenger aircraft, several of which are scheduled for freight conversion.

The sale is an asset transaction with no transfer of management resources. The aircraft will be sold in a series of closings scheduled to occur between January 2007 and February 2009. The sale, which represents substantially all of the assets currently owned or contracted by GAIF, is subject to customary closing conditions.

"This transaction provides GAIF investors the opportunity to achieve their investment objectives," said GAP Executive Officer Stephen Rimmer. "While it wasn't an anticipated realization in respect to timing, we believe it presented an attractive risk return profile for GAP to recommend to the Fund's investors."

GAP is also the manager of Guggenheim Aviation Investment Fund II, LP (GAIF II), which was formed in 2006 and has a similar investment strategy in the commercial jet aircraft and engine sector. GAIF II owns or has contracted to purchase 19 aircraft (747-8Fs, 777Fs, A330Fs, 767-300ER, 737-700s & 737-300s) and holds options to purchase three additional aircraft.

"GAP remains optimistic about the opportunities within the aircraft asset sector and looks forward to continuing and growing its activities in the space," said Rimmer. "We and our investors will continue to invest in aircraft, particularly the medium to long haul freight market. Because the sale is a pure asset transaction, our team is well positioned to pursue our strategy in GAIF II."

Milbank, Tweed, Hadley & McCloy LLP and Skadden, Arps, Meagher & Flom LLP advised Aircastle and Kaye Scholer LLP advised Guggenheim.

SOURCE: Guggenheim Partners