Willis Lease Finance Secures Major Funding for Aircraft Engine Portfolio Expansion

Willis Lease Finance US9706461053

Willis Lease Finance Corporation has successfully closed two significant financial transactions that provide nearly one billion dollars in fresh capital, fundamentally reshaping its balance sheet and growth prospects. The aircraft engine lessor's strategic moves center on a new partnership and a substantial bond issuance, both aimed at fueling its core leasing business.

A newly formed alliance with Liberty Mutual Investments (LMI) stands as the cornerstone of the company's refreshed strategy. This partnership provides Willis Lease Finance with access to a committed $600 million capital pool, earmarked specifically for financing its aircraft engine leasing operations. The involvement of LMI, an institutional investor managing over $117 billion in assets, signals strong confidence in the lessor's business model.

To facilitate large-scale financing activities, a warehouse loan facility has been established with Bank of America, ensuring readily available liquidity. This comprehensive structure creates a dedicated and robust new pillar for the company's lending activities.

Bond Issuance Adds Long-Term Stability

Concurrently, the company has finalized a major securitization transaction through its subsidiary, Willis Engine Structured Trust IX (WEST). This deal involves the placement of $392.9 million in fixed-rate notes, with settlement expected on December 23, 2025.

The issuance is structured in two classes:
* Series A Fixed Rate Notes: $337.4 million principal amount carrying a coupon rate of 5.159%.
* Series B Fixed Rate Notes: $55.5 million principal amount with a 5.696% coupon.

These notes are secured by a collateral portfolio consisting of 47 commercial aircraft engines and two airframes. By locking in fixed interest rates, the company gains predictable, long-term financing, insulating itself from future interest rate volatility. The combined financial firepower from the LMI partnership and the bond deal totals over $990 million.

Operational Context and Governance

The capital raise follows a quarter of mixed operational results. For Q3, the company reported revenue of $183.4 million, surpassing market expectations of $164 million. However, its earnings per share (EPS) of $3.25 fell short of the anticipated $3.69, potentially indicating higher operational or transitional costs.

Recent corporate governance actions point toward leadership stability. These include an updated employment agreement for CEO Austin Willis and a repurchase of 30,000 shares from the Executive Chairman. Institutional investors continue to hold a significant stake, accounting for approximately 48.85% of the company's equity.

With its strengthened capital position, Willis Lease Finance is now poised as a well-funded player in the aircraft engine leasing market. Investor attention will likely shift to the pace at which this capital is deployed into new engine financing and leasing contracts. Key metrics to watch in coming quarters will be asset utilization rates and the company's leverage profile as it puts its new financial resources to work.