(Bloomberg) -- Bohai Leasing Co. is close to refinancing debt worth $2 billion as RRJ Capital, MBK Partners Ltd. and other financiers are ready to provide new funds, according to people familiar with the matter.
Asian private equity firms RRJ and MBK are seeking to commit $1.25 billion and up to $600 million, respectively, in a new three-year private loan, said the people, who asked not to be named discussing private information.
Other lenders in talks include China Citic Bank International Ltd., Deutsche Bank AG and Elham Credit Partners — a private credit fund set up by investment firm Hillhouse.
The new facility is expected to sign as early as next week, the people said, adding that allocations are still being finalised.
Deutsche Bank, MBK, RRJ and Hillhouse declined to comment. Bohai Leasing and China Citic Bank International didn’t respond to requests for comment.
Bohai Leasing had been grappling with liquidity pressure over the past few years. The aircraft and container leasing firm failed to repay about 2.3 billion yuan ($317 million) of onshore debt last year, according to its latest annual report from April. But it also said its offshore subsidiaries have sufficient cash and access to refinancing channels.
Final pricing of the new facility is still in the works, but it is expected to pay around 600 basis points over the three-month Secured Overnight Financing Rate. It will be backed by the borrower’s stake in leasing firm Seaco and Avolon, the world’s fourth-largest plane lessor, the people added.
Proceeds of the new facility will refinance borrowing issued by Bohai Leasing’s subsidiary Global Aircraft Leasing Co., the people said. This debt, with around $2 billion in outstanding principal, will mature in September, according to Bloomberg-compiled data.
--With assistance from Bei Hu.
(Updates with details on two other likely lenders)
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