Hanwha Aviation Secures Financing For Engine Leasing Growth
South Korean engine lessor Hanwha Aviation has secured more firepower to support its ambitious portfolio growth plans following a financing deal with KEB Hana Bank.
The South Korean lender will provide a “large” senior syndicated debt facility for Hanwha Aviation to continue its strategy of investing in CFM56, CFM Leap and IAE V2500 engines.
Earlier this year, Hanwha Aviation VP of commercial Laura Ivaskaite told Aviation Week’s ELTF (Engine Leasing, Trading & Finance) Europe conference that the lessor’s portfolio stood at around 40—mostly CFM56—engines, adding that it would like to grow this to “a few hundred” engines over the next five years.
Hanwha’s ultimate goal of 1,000 engines is needed for it to achieve the necessary scale in the engine leasing market, she said.
The new debt facility will also support Hanwha’s vertically integrated asset management strategy.
In May, roughly a year after launching its engine leasing business, Hanwha Aviation announced it would purchase a U.S. engine MRO facility.
“This acquisition represents a foundational step in our vertically integrated approach to engine leasing and asset management,” Hanwha Aviation CEO Jeff Lewis said at the time. “By incorporating in-house MRO capabilities, we enhance our ability to offer comprehensive, cost-effective solutions throughout the engine lifecycle. This move complements Hanwha’s existing strengths in aerospace manufacturing and reinforces our commitment to delivering end-to-end value to our customers.”
Parent company Hanwha Group hopes to benefit from its vertically integrated aerospace business, which already included partnerships with the major engine OEMs, General Electric, Pratt & Whitney and Rolls-Royce, via its engine parts division.
In 2016, Hanwha entered into a joint venture with Pratt & Whitney to operate a Singaporean manufacturing company as well as a risk and revenue-sharing partnership designed to co-build the next-generation aircraft engine. In 2019, it acquired EDAC Technologies, a U.S. aircraft engine component manufacturer, and launched Hanwha Aerospace USA to expand its product portfolio and leverage high-end processing technology.
Lewis said the latest addition is an FAA- and EASA-certified facility that specializes in hospital and on-wing services for a range of engine types, including the CFM56.
