Avation PLC (LSE:AVAP), the commercial passenger aircraft leasing company, has successfully refinanced two leased Airbus A220-300 aircraft.
Both Airbuses were previously financed in Avation's floating rate warehouse finance facility and have now been refinanced with fixed-rate term loans from a major Japanese bank.
The loans, which have euro and dollar tranches, amount to nearly $44mln and the extended term of 8.5 years matches the lease duration.
Avation is now approximately 95% hedged against interest rate increases in its loan book using fixed-rate loans and interest rate swaps.
Executive chairman Jeff Chatfield said: "Avation welcomes its first major Japanese bank as a lender.
“Avation has strategically lowered its floating interest rate risk by fixing these loans for a period of 8.5 years.
“We were also pleased to be able to lower the interest rate margin for these loans which we consider to be an excellent result in the current financial environment."
London-listed AVAP shares are over 12% up on the five-day period as of 14 November (8:15am GMT).