Waha Capital extends maturity of collar hedges on c.19 million AerCap

Waha Capital has extended collar hedges on 18.89 million shares for up to 43 months approximately and sold a further 4 million shares in New York-listed AerCap Holdings NV. AerCap’s share price was $45.46 at close of New York trading on 22nd November, 2016. The 4 million shares were acquired at an average purchase price of $36.51 in an open market share purchase programme announced in January 2016.

The transactions serve to continue Waha Capital’s strategy of hedging its equity market exposure, while generating cash to pursue its growth strategy.

"Waha Capital is a long-term strategic investor in AerCap and we have decided to roll over our collar hedges to ensure that we can participate in potential upside in the coming years, while limiting our equity market risk," said Hussain Jasim Al Nowais, Chairman of Waha Capital.

In August this year, Waha Capital extended the maturity for 3.97 million shares in AerCap for a period up to 25 months and also has in place an additional collar hedge for another 3.97 million shares.

The net effect of these transactions is that Waha Capital has now locked in the value of its entire remaining portfolio of 26.85 million AerCap shares at an average minimum price of $38.36 per share, while allowing for future upside participation up to an average price of $62.01 per share. All of these collar hedges will now mature progressively over the 2018-2020 period.

The sale proceeds were partly used to fund the extension of collar hedges on the 18.89 million shares and to pay down related debt. The remainder, which will be received by the company as a net cash payment of $81 million, will be used to implement Waha Capital’s diversification and growth strategy, including expanding its asset management business.

In addition to its stake in AerCap, Waha Capital invests in healthcare, energy, financial services, infrastructure and other high-potential sectors in the MENA region. The company’s asset management business is offering credit, equity and private equity funds to third-party investors.