Aviation restructuring a drag on Waha

Abu Dhabi-based finance house outlines plans to raise funds through a convertible bond.

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The restructuring of Waha Capital's aviation leasing business dragged down the Abu Dhabi company's first-quarter profits.

The financing and property company reported a 10.9 per cent drop in earnings and said it would raise Dh500 million (US$136.1m) in a convertible bond in the next two months.

First-quarter profits declined to Dh29.77m, which Waha attributed to restructuring as well as efforts to consolidate its aviation business last year with a Dutch company.

The convertible notes "will be mandatorily convertible into shares in the company three years after issue", Waha said. It added that it would shortly consider other key terms of the issue, including the price and coupon rate, and would inform the Abu Dhabi Securities Exchange and financial regulator once these terms were approved by the Waha board.

In October, Waha agreed to acquire a 20 per cent stake in AerCap Holdings, a Dutch aircraft leasing company, in a deal valued at $380m.

In return for the stake, Waha agreed to transfer to AerCap aircraft assets held independently, as well as those held in an earlier joint venture, in addition to $105m in liabilities and cash.

In 2009, the company was approached by the UAE Armed Forces to help arrange financing for several military aircraft deliveries.

It is also an emerging property developer for industrial warehouse projects, with its Al Markaz project expected to finish its first phase of construction by the third quarter of this year.

The project broke ground this year on a 150-hectare plot, on which will be built light industrial units covering 9 hectares.

The firm is also engaged in maritime finance, including ship leasing. "Waha has developed a diversified business group to deliver sustained growth," the company said.

Waha lists assets worth more than $1bn. Its first-quarter operating income declined to Dh83.4m, from Dh112.2m in the same period one year ago. The company listed investment commitments of Dh130m, and capital commitments of Dh349m relating to its Al Markaz development.