Fitch assigns B to FTAI preferred shares

Fitch Ratings said it gave an expected B rating to FTAI Aviation Ltd.’s contemplated series D preference shares and placed the ratings, including the issuer default rating, on rating watch negative. The expected rating is also on RWN.

“The expected and existing ratings on FTAI's preferred shares are two notches below the company's long-term IDR reflecting the subordination and heightened risk of non-performance of the instrument relative to other obligations,” Fitch said in a press release.

The issuance size, coupon and maturity date will be decided at the time of the issuance. The proceeds are earmarked for general corporate purposes.

“The RWN reflects the lower-than-expected tangible equity balance following the infrastructure spin-off resulting in higher leverage and uncertainty around the pace of deleveraging towards Fitch's previously articulated leverage sensitivity (calculated as gross debt to adjusted tangible equity) of 6x by 1Q24. Adjusting equity for 50% equity credit on its outstanding preference shares and excluding goodwill, FTAI's adjusted tangible equity position as at YE22 was negative $170 million,” the agency said.

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