Chorus Aviation Announces Agreements to Trade 8 Aircraft for Net Proceeds of USD $45 Million
HALIFAX, NS, Aug. 29, 2022 /CNW/ – Chorus Aviation Inc. (‘Chorus’) (TSX: CHR) today announced that its subsidiary, Falko Regional Aircraft Limited (‘Falko’) has executed agreements to sell 8 wholly owned aircraft that had previously been on lease, for net proceeds of approximately USD $45 million after related debt repayments and estimated tax provisions. The Falko team has an extensive track record of opportunistically selling aircraft, having completed over 160 aircraft sales.
"I’m pleased to report that the first trading transaction of the Chorus/Falko era is taking place. This deal is transacting at one time book value and will generate net free cash flow of approximately USD $45 million," stated Joe Randell, President and Chief Executive Officer, Chorus.
Mr. Randell continued, "The recent Falko acquisition has made Chorus a market leading regional aircraft asset manager and the world’s largest aircraft lessor focused solely on the regional aircraft leasing space, significantly advancing our growth and diversification strategy."
"The sale of these Chorus owned aircraft decreases debt and leverage while generating cash flows from trading. We will continue to look for opportunistic asset sale transactions to increase shareholder value," concluded Mr. Randell.
This transaction is expected to close before the end of the third quarter of 2022 and is not expected to materially change the financial forecast set out in Chorus’ news release dated August 4, 2022.
About Chorus Aviation Inc.
Chorus’ vision is to deliver regional aviation to the world. Headquartered in Halifax, Nova Scotia, Chorus is an integrated provider of regional aviation solutions, including asset management services. Its principal subsidiaries are: Falko Regional Aircraft, the world’s largest asset manager and aircraft lessor focused solely on the regional aircraft leasing segment; Jazz Aviation, the sole provider of regional air services to Air Canada; and Voyageur Aviation, a provider of specialty air charter, aircraft modification, and parts provisioning services to regional aviation customers around the world. Together, Chorus’ subsidiaries provide support services that encompass every stage of a regional aircraft’s lifecycle, including: aircraft acquisition and leasing; aircraft refurbishment, engineering, modification, repurposing and transition; contract flying; aircraft and component maintenance, disassembly, and parts provisioning.
Chorus Class A Variable Voting Shares and Class B Voting Shares trade on the Toronto Stock Exchange under the trading symbol ‘CHR’. Chorus 6.00% Senior Debentures due December 31, 2024, 5.75% Senior Unsecured Debentures due December 31, 2024, 6.00% Convertible Senior Unsecured Debentures due June 30, 2026, and 5.75% Senior Unsecured Debentures due June 30, 2027 trade on the Toronto Stock Exchange under the trading symbols ‘CHR.DB’, ‘CHR.DB.A’, ‘CHR.DB.B’, and ‘CHR.DB.C’ respectively. www.chorusaviation.com
This news release may contain ‘forward-looking information’. Forward-looking information is identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "potential", "project", "will", "would", and similar terms and phrases, including references to assumptions. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to differ materially from those indicated in the forward-looking information. Actual results may differ materially from results indicated in forward-looking information for a number of reasons, including the factors identified in Chorus’ public disclosure record available at www.sedar.com and the risk factors identified in Chorus’ Annual Information Form dated February 16, 2022 (as updated by the risk factors identified in Chorus’ Management’s Discussion and Analysis of Operations and Financial Condition dated May 5, 2022). In particular, it is possible that the transactions contemplated by this news release fail to close on the terms currently contemplated or at all. Statements containing forward-looking information represent Chorus’ expectations as of the date made (or as of the date they are otherwise stated to be made) and are subject to change after such date. Chorus disclaims any intention or obligation to update or revise such statements to reflect new information, subsequent events or otherwise, unless required by applicable securities laws.
SOURCE Chorus Aviation Inc.