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BOC Aviation draws Boeing, sovereign funds to US$1.1 billion IPO

[HONG KONG] BOC Aviation Ltd, Asia's biggest aircraft lessor, attracted investors including Boeing Co and the Chinese sovereign wealth fund to buy shares in its US$1.1 billion initial public offering in Hong Kong.

China Investment Corp and the Silk Road Fund agreed to each invest US$100 million in the offering, while Oman Investment Fund will buy US$50 million of stock, according to terms for the deal obtained by Bloomberg. Boeing, the world's biggest planemaker, committed US$30 million, and Chinese billionaire Guo Guangchang's Fosun International Ltd will purchase US$35 million of shares, the terms show.

Spurred by strong economic growth in the past decade and rising incomes in the world's two most-populous countries, China and India, Asia is on course to beat the US as the biggest market, according to Airbus Group SE and Boeing. That potential has lured billionaires such as Li Ka-shing and budget-carrier pioneer Tony Fernandes to the plane-leasing market, where returns from multiyear contracts can exceed those of airlines.

BOC Aviation and its controlling shareholder are offering a combined 208.2 million shares in the IPO at a fixed price of HK$42 apiece. The company has agreed to sell shares to 11 cornerstone investors, who will take up 52 per cent of the base offering, the terms show.

China Development Bank Corp will invest US$60 million in the share sale, while China Life Insurance Co and Chinese private- equity firm Hony Capital Ltd will each purchase US$50 million of stock, the terms show. BOC International Holdings Ltd and Goldman Sachs Group Inc. are joint sponsors of the offering.

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BOC Aviation management will meet investors through May 23, according to the terms. The company aims to begin trading June 1.


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