8-KEarnings & ResultsOther EventsExhibits & Filings

FTAI Aviation Ltd. 8-K Report, Financial Results (Apr 28, 2022)

Filed April 28, 2022For Securities:FTAIFTAIMFTAIN

Summary

FTAI Aviation Ltd. (FTAI) announced on April 28, 2022, preliminary results for the fiscal quarter ended March 31, 2022, through a press release furnished with its 8-K filing. More significantly, the company detailed substantial progress on its planned spin-off of its infrastructure business into a new entity, FTAI Infrastructure. This entity will house key assets including the Jefferson Terminal, Repauno business, Long Ridge investment, and Transtar business, and will seek a listing on Nasdaq. The spin-off is intended to create two distinct, publicly traded companies with focused investment profiles. FTAI Infrastructure plans to raise up to $300 million in preferred stock and warrants and incur up to $500 million in senior secured debt, with net proceeds going to FTAI. FTAI intends to use these proceeds to repay outstanding bridge loans, its revolving credit facility, and a portion of its senior unsecured notes. Following the spin-off, FTAI plans to pursue a merger transaction to become a wholly owned subsidiary of a Cayman Islands-registered entity, subject to shareholder approval.

Key Highlights

  • 1FTAI is proceeding with the spin-off of its infrastructure business into a separate entity, FTAI Infrastructure, which has confidentially filed a registration statement and plans to list on Nasdaq.
  • 2FTAI Infrastructure will include the Jefferson Terminal, Repauno, Long Ridge investment, and Transtar businesses.
  • 3FTAI Infrastructure intends to raise significant capital through preferred stock, warrants, and senior secured debt, with proceeds flowing to FTAI.
  • 4FTAI plans to use proceeds from the spin-off to repay outstanding debt, including bridge loans, its revolving credit facility, and a portion of its 2025 senior unsecured notes.
  • 5Post-spin-off, FTAI intends to merge with a Cayman Islands-domiciled company, pending shareholder approval.
  • 6The spin-off is expected to be completed in the second quarter of 2022, though completion is subject to various conditions and there's no guarantee it will occur.
  • 7Management and organizational changes are planned, with Eun (Angela) Nam becoming FTAI's CFO and specific leadership roles assigned for FTAI Infrastructure.

Frequently Asked Questions

This 8-K filing primarily serves to announce FTAI Aviation Ltd.'s (FTAI) fourth-quarter 2021 financial results press release and, more importantly, to provide significant updates regarding the planned spin-off of its infrastructure business into a new entity, FTAI Infrastructure.

FTAI Infrastructure will include FTAI’s Jefferson Terminal business, Repauno business, Long Ridge investment, and Transtar business. These are substantial infrastructure assets including terminals, a deep-water port, and freight railroads.

FTAI Infrastructure plans to raise capital through debt and equity offerings. The net proceeds from these offerings are expected to be remitted to FTAI. FTAI intends to use these funds to repay its outstanding bridge loans, its revolving credit facility, and a portion of its 6.50% senior unsecured notes due 2025.

Following the completion of the spin-off, FTAI plans to pursue a merger transaction where it would become a wholly owned subsidiary of a newly formed company organized under the laws of the Cayman Islands. This merger is subject to approval by FTAI's common shareholders.

The spin-off is expected to be completed in the second quarter of 2022. However, the company explicitly states there can be no assurance it will be completed as anticipated or at all. Risks include failure to meet conditions, potential negative impact on share price if not completed, and the possibility that the expected strategic and financial benefits may not materialize or may be delayed.