Korean financial institutions provide 15-year 100% financing for Etihad's A380

The funding was provided by way of a private placement with a group of major Korean institutional investors and was arranged by London-based aviation finance specialists Magi Partners in conjunction with their Korean associates, Youjee Partners. The deal follows non-deal roadshow meetings between Etihad Airways and Korean investors in early 2014, and a competitive global request for proposals last summer. 

The transaction, which is structured as a 15-year, fixed coupon full-payout finance lease, is the first ever Korean financing to be arranged covering the entire cost of a brand new A380 aircraft. 

The aircraft is the second of a fleet of ten A380s on order from Etihad Airways to enter service and, like all the airline’s A380s, features The Residence by Etihad. 

Since inception Etihad Airways has raised more than US$10.5 billion from over 70 financial institutions and lessors to fund its fleet of aircraft and engines.

James Hogan, president and chief executive officer of Etihad Airways, said: “We are delighted to have engaged so positively with Korean investors, thereby securing strong interest from Korean institutions in the course of our first entry into the Korean market, which we see as a potentially fruitful longer term partnership for us in the future.” 

Peter Vardigans of Magi Partners, said: “This financing is a landmark deal for the Korean market and we are delighted to have been able to complete this transaction for such a prestigious airline as Etihad Airways.  We anticipate that Korean institutions will provide a growing strategic source of capital for the global aviation market. “