China's Bohai Leasing has agreed to buy 20% of Dublin based Avolon Holdings for $429m, in the latest acquisition by a unit of aviation and shipping conglomerate HNA Group.
The purchase would be HNA's biggest in logistics since the $1 billion buy of marine container leasing firm GE SeaCo in 2011.
It would provide access to a global aircraft leasing market dominated by GE Capital and AerCap Holdings.
Avolon sells aircraft leasing and lease management services to airlines and aircraft investors. The firm has a fleet of over 260 aircraft serving 56 customers in 33 countries.
Those customers include American Airlines Group, Air France and Ryanair.
"The acquisition of a 20% stake in Avolon by Bohai, at a premium to our current share price, reflects their confidence in the outlook for the sector, the attractiveness of the Avolon investment case and the strength of our global franchise," commented Avolon's CEO Dómhnal Slattery.
"We are proud to welcome Bohai as a strategic investor in Avolon and look forward to developing our relationship with both Bohai and the broader HNA Group," he added.
"This investment in Avolon will bring Bohai an increasing presence in the global aircraft leasing sector and Bohai will have a strong interest in benefiting from Avolon's profitable growth," the company's chief executive Chris Jin said in a statement.
Chinese lessors, mostly backed by state-owned banks, have been expanding in recent years, as large carriers such as Hainan Airlines, Air China, China Eastern Airlines and China Southern Airlines opened more routes at home and overseas.
Aircraft maker Boeing has estimated that China will need over 6,000 new aircraft over the next 20 years.
Bohai parent HNA owns miscellaneous shipping and aerospace companies including Hainan Airlines, and has been buying logistics and hotel assets to expand globally.
Previously, sovereign wealth fund China Investment Corp had partnered state-owned Aviation Industry Corp of China to explore a take over of Avolon, but ended talks in October.
