Willis Lease Finance Corp Secures $596 Million in Fixed Rate Notes

In a significant financial move, Willis Lease Finance Corporation (WLFC) has successfully priced $596 million in fixed rate notes, underscoring strong market confidence in the company’s financial health and strategic direction. This transaction, announced on June 6, 2025, was highlighted by multiple sources, including Investing.com, GlobeNewswire, and StockTitan, reflecting its importance in the financial community.

Strategic Financing and Market Confidence

The financing, structured through WLFC’s subsidiary, Willis Engine Structured Trust VIII (WEST), comprises $524 million in Series A Notes with a fixed interest rate of 5.582% and $72 million in Series B Notes at 6.070%. Both series were priced nearly at par value, demonstrating the attractiveness of the terms offered to investors. This successful pricing is a testament to the robust demand for WLFC’s securities, driven by the company’s solid asset base and strategic market positioning.

Secured by Aviation Assets

The notes are secured by a substantial portfolio of aviation assets, including 62 aircraft engines and two airframes. This asset-backed structure is typical in the aviation finance sector, providing investors with a layer of security and confidence in the transaction. The maturity of the notes is expected to be approximately six years, with a weighted average life of 5.1 years, though the final maturity extends to 25 years. This long-term perspective aligns with the lifecycle of the underlying assets, offering stability and predictability for both WLFC and its investors.

Competitive Interest Rates in Current Market Conditions

The fixed interest rates of 5.582% and 6.070% are relatively competitive, considering the current market conditions. These rates reflect WLFC’s ability to secure financing at favorable terms, which is crucial for maintaining financial flexibility and supporting its growth initiatives. The transaction is limited to qualified institutional buyers and non-U.S. persons, which, while restricting the investor base, aligns with the typical profile for such asset-backed securities.

Implications for Financial Leverage

While the additional debt obligation could increase WLFC’s financial leverage, the company’s strong asset base and strategic use of financing are expected to mitigate potential risks. The capital raised through this transaction will likely support WLFC’s ongoing operations and expansion efforts, particularly in its core business of leasing aftermarket commercial aircraft engines and related equipment to passenger airlines and air cargo carriers.

Conclusion

The successful pricing of $596 million in fixed rate notes marks a significant milestone for Willis Lease Finance Corporation. It not only reflects strong market confidence but also reinforces the company’s strategic financial management. As WLFC continues to navigate the competitive landscape of the aviation finance sector, this transaction positions it well to capitalize on future opportunities and sustain its growth trajectory.