Chinese Group Buys 80% of AIG Plane Unit for $4.2 Billion

Chinese Group Buys 80% of AIG Plane Unit for $4.2 Billion

www.bloomberg.com

A Chinese group agreed to buy 80.1 percent of American International Group Inc. (AIG)’s plane-leasing unit for $4.23 billion in the nation’s largest acquisition of a U.S. company.

The International Lease Finance Corp. acquirers, led by New China Trust Co. Chairman Weng Xianding, have an option to buy another 9.9 percent... The transaction, which values ILFC at $5.3 billion...

The acquisition gives the group control of the world’s second-largest aircraft lessor...

(visit the link for the full news article)


Related News Links:
in.reuters.com
www.businessweek.com< br /> dealbook.nytimes.com
www.aviationpros.com

Related AboveTopSecret.com Discussion Threads:
AIG. Conspiracy Theories of the World Unite
Billions More For AIG

AIG was at the center of the bailouts. To put it simply, they sold insurance on risky financial derivatives products. When that market began to collapse, they could not cover their obligations to pay out, which would have meant that many banks and other financial institutions would have suddenly been insolvent. The bailout of AIG was the largest bailout of a private company by the US government in history.

According to Wikipedia, ILFC (International Lease Finance Corp) is one of the two largest aircraft leasing companies in the world (the other being General Electric, GE). ILFC leases planes to many major airlines, including:

Aeroméxico
Air Canada
Air France-KLM
Air India
Alaska Airlines
American Airlines
Asiana Airlines
Cathay Pacific
Cyprus Airways
Delta Air Lines
Emirates
Gulf Air
Korean Air
Lufthansa
Norwegian Air Shuttle
Pakistan International Airlines
United Airlines

The deal will have to be reviewed by the Committee on Foreign Investment in the United States for any security concerns.

If you start looking into AIG, it leads down the rabbit hole as they are a heavyweight in the insurance industry with huge tie-ins with Central Bankers.

But perhaps of even more concern here are the potential implications of Chinese control of leasing the planes to major airlines. First, from an economic perspective you have to wonder if they are going to supply Boeing and Airbus planes, as ILFC currently does, or if this is a way to get Chinese planes into the world market long term. Second, you have to wonder about whether the Chinese will just do the financials or whether they will ever have physical control of the planes. I would think that the US especially would have security concerns if the Chinese would have physical access to a high percentage of the planes of American airlines.

Anyone know if Air Force One is leased?

www.bloomberg.com
(visit the link for the full news article)

reply to post by ikonoklast


As Air Force one (or the 747's that bear that call sign anyway) is highly customised and full of secure widgetry and gadgetmotrons, I would be surprised if it was leased, but you never know!

As for your idea this might be a way to shoehorn otherwise undesirable Chinese aircraft into the market, I certainly hope not. China doesn't really have a track record in making "safe" products and you really want to have confidence in an aircraft.

With the amount of debt, China will end up owning the U.S.

China is one ginormous bubble awaiting the needle.
.....What that rigger will be , i am not sure yet, but China has very shaky underpinings in a lot of basic areas....
It apears to me that the national goverments of planet earth, are all deeply indebted to the bankers.....
The whos who of finance internationally, funds all the movements and parties that have any weight in politics...
Taiwan,China, Russia, and the USA.....ALL owned by the same banking cabal hidden by semantics and deception......
The plan in my mind, is to crash the whole world at once, or possibly a controlled crash that slow motions over a decade or two....bringing maximum financial leverage individually or small blocs to the nations....
In the end game soveriegnty and freedom will be sold down the river by those who are orruptable or those who have infiltrated and controlled the halls of power for a long time.
The strategy china is takin with all that worthless US debt they carry, is to spend like a drunken sailor on resources world wide of all types.....they may be paying premiums now, but will collect dividends later...when they suddenly have the world markets cornered for valuable minerals etc.....

I find it interesting that there is very little information online about Weng Xianding, the chairman of the New China Trust Company. Weng and the New China Trust Company are cited by all the new stories as leading the group of investors purchasing ILFC from AIG.

Bloomberg says:

The transaction, which values ILFC at $5.3 billion, passes China Investment Corp.’s $3 billion purchase of a stake in Blackstone Group LP (BX) in 2007 as the biggest Chinese-U.S. deal.

SOURCE: Bloomberg

And yet there is almost nothing about Weng Xianding other than articles on this purchase when you Google his name. Even the South China Morning Post had nothing else on him.

I did find out that Barclay's owns an almost 20% stake in New China Trust Company. [According to the South China Morning Post.

For someone with virtually no online profile to put together a $5.3 billion international deal involving multiple large investors makes me think there's more than meets the eye:

The group investing in ILFC includes New China Trust, China Aviation Industrial Fund and P3 Investments Ltd., AIG said. China Life Insurance Co. (2628) and a unit of ICBC International Holdings Ltd., the investment banking arm of the world’s biggest bank, may also join once the deal is approved by regulators and the option to buy a further stake is exercised, it said.

SOURCE: Global Geopolitics

Wikipedia HAD a page of ILFC customers, but when you go there now it says it was deleted on November 11, 2012:
List of International Lease Finance Corporation customers

So I think there is more to this than meets the eye...

Looking at China Life Insurance Company turns up some interesting info. They said they may invest after regulators approve the deal.

The gains allow China Life to ... become the world's no. 2 insurer with a market value of $129 billion, behind American International Group's $186 billion...

3.02 billion yuan in illegal activities

China's audit office said it uncovered "improper and illegal activities" involving 3.02 billion yuan at two of the country's largest insurers, People's Insurance Co. of China Ltd. and China Life Insurance Co., during an audit of their 2009 books. They are charged with offences including the illegal sale of policies, overstating policy sales, improper claim settlements, illegal distributions of commissions and "grey income" - off-the-books gains, some of which company officials pocketed among themselves.

SOURCE: Wikipedia

So they are the #2 insurance company in the world, second only to AIG! And they are apparently under investigation by China, which probably explains why people want to get approval from regulators before they join the deal.

As for ICBC International Holdings Ltd.:

ICBC International Holdings Limited (“ICBC International”) is the wholly-owned HK subsidiary of the Industrial and Commercial Bank of China Limited (“ICBC”), and the sole investment banking platform of ICBC...

ICBC is the world’s largest bank in terms of market capitalization, customer deposit and profitability. ICBC International, the sole investment banking platform of ICBC...

SOURCE: ICBCI company profile

Yes, they are the investment bank division of the largest bank in the world. And according to Wikipedia, it is state-owned by China.

Originally posted by ikonoklast

First, from an economic perspective you have to wonder if they are going to supply Boeing and Airbus planes, as ILFC currently does, or if this is a way to get Chinese planes into the world market long term.

that would be a good thing for Chinese industry - I don't doubt it is part of het thinking.

Second, you have to wonder about whether the Chinese will just do the financials or whether they will ever have physical control of the planes. I would think that the US especially would have security concerns if the Chinese would have physical access to a high percentage of the planes of American airlines.

Leasing companies have access to inspect their aircraft as you would expect. But currently all operational decisions are made by the airline - that is normally the legal requirement of civil aviation rules in Westen countries - the certificate holder (airline) is responsible for ensuring teh aircraft is maintained and operated in an airworthy manner.

ther ehave been a couple of cases where leasing companies have gone to lengths to seize back a/c into their control - but those are pretty well known because of their rarity - usually courts will impound a/c if the leasing company can prove its case.

Anyone know if Air Force One is leased?

both VC-25's are owned by the US Govt., and operated on its behalf by the USAF- as per this PAR for their replacements they were purchased, not leased.

China currently has two commercial aircraft types in production, so I don't think we'll have to worry about them "flooding the market" with "unsafe Chinese aircraft". If they are going to sell their aircraft in foreign countries, they have to be certified by the aviation governing body of that country. When the ARJ-21 was going through Chinese certification by their governing body, the FAA was doing a shadow certification alongside them, so they would be eligible to sell them in the US eventually. So for them to operate here, or anywhere else, they have to meet the standards of that countries aviation governing body, whether it be the FAA, ICAO, or whoever else.

We have really got to stop giving the Chinese money
How about we start making our own stuff now and selling it back to us